Select a publicly traded manufacturing company of your own choice and use the ROIC / FCFF approach to:

1) Calculate normalized earnings or cash flow as if these numbers are achieved instantaneously (i.e., realized at this very moment in time);

2) List the factors or assumptions associated with the normalized earnings or cash flow;

3) Using the normalized earnings or cash flow as a mid-range number, estimate what you believe are high-end (optimistic) and low-end (pessimistic) earnings or cash flow numbers, and estimate the likelihood or probability of those outcomes in relation to the normalized results.

4) Based on the probability associated with these 3 scenarios, what is the expected value of earnings and/or cash flow?

5) Use of normalized financial results implies a reliance on historical data to predict future outcomes. Under what circumstances would you contemplate departing from historic averages and making your own estimates on the factors that influence valuation of future outcomes? Explain your reasoning.