Q8

As of February 2016, you are researching HouseDepot, Inc, a hypothetical company subject to cyclical demand for its services. HouseDepot shares closed at $76.85 on February 2016. You believe the 2011-2015 period reasonably captures average profitability Use a normalized EPS for HouseDepot based on the method of historical average EPS to calculate the P/E based on normalized EPS Use a normalized EPS for HouseDepot based on the method of average ROE to calculate the P/E based on normalized EPS Why we need to use normalized EPS