Revenues are based on average costs per project based on estimated time and complexity of project plus and undisclosed profit margin.
Based on average salaries, wages for a four-person cleaning crew handling one store come to $83,000 a year, leaving Clancy with an estimated profit of $84,000 a year from his Wal-Mart contracts after paying wages.
Prices based on average energy consumption.
On average, profits have increased by about a third.
If one uses trend earnings, rather than the 10-year average, the Shiller p/e would jump from 25 to 34.Thirdly, he looks at the argument that the market average should be based on the profits numbers from the national accounts, rather than from the more volatile measures reported by companies.
Share prices have risen by 400% in just over two years, and average price-earnings ratios based on historic profits are around 50 (based on forecast 2008 profits they are a still-racy 30).
While earnings for tech and industrial companies are growing faster than the broad market, stocks in these sectors are trading at an average price/earnings ratio of 13.3 based on projected profits, according to Bloomberg.
A guess may be that given they way they're normally rewarded, with fees based on total profits (not profits relative to a market-average baseline — e.g., 2 and 20), they find themselves hurting financially from a low-yield world.
Chinese shares certainly look expensive, with an average price-earnings ratio of almost 50 (based on historic profits).
At the end of March, the average "forward-looking" p/e of American firms (as tracked by IBES, a research firm) was 21, based on forecast profits for the coming year.
