Can someone please explain what the BLAST e-value represents and how it is calculated? Thanks a lot.

From the documentation:

The Expect value (E) is a parameter that describes the number of hits one can « expect » to see by chance when searching a database of a particular size. It decreases exponentially as the Score (S) of the match increases. Essentially, the E value describes the random background noise. For example, an E value of 1 assigned to a hit can be interpreted as meaning that in a database of the current size one might expect to see 1 match with a similar score simply by chance.

The lower the E-value, or the closer it is to zero, the more « significant » the match is. However, keep in mind that virtually identical short alignments have relatively high E values. This is because the calculation of the E value takes into account the length of the query sequence. These high E values make sense because shorter sequences have a higher probability of occurring in the database purely by chance. For more details please see the calculations in the BLAST Course.

I hope this helps.

Awesome! Thanks. That clears a lot up.