I know I’m vastly oversimplifying it but typically speaking stock returns are generally a function of changes in EPS x changes in P/E.
However, on the returns level, we can also decompose return attribution and risk attribution as a function of factors (value, growth, quality, momentum, etc).
Therefore, are factor premiums a component of P/E or EPS? Is it both? Or is the framing of this question inherently flawed?
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