I am having a bit of trouble understanding the following quote:
Companies that are inherently speculative because of widely varying earnings tend to sell both at a relatively high price and at a relatively low multiplier in their good years, and conversely at low prices and high multipliers in their bad years.
I'm a little confused that he is saying 'high price' and 'low multiplier' in the same sentence. When he uses the term 'multiplier', I'm assuming he is talking about the P/E ratio. So a 'low multiplier' should mean a lower price, not a higher price, right? To me it just doesn't make sense that he could be describing a single company as high priced but with a low P/E.
Am I missing something here?
The quote can be found on page 165 in the following PDF: