When using the P/E valuation model, it is important to remember that the multiplier is more volatile than the earnings component.

Name: When using the P/E valuation model, it is important to remember that the multiplier is more volatile than the earnings component.
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The P/E ratio's multiplier (price) can fluctuate due to market sentiment, economic conditions, and investor expectations, making it more volatile than the earnings component, which tends to be more stable over time.

When Using the P/E Valuation Model, It Is Important to Remember