As per the example 17 in reading 50 of CFAI text non-cyclical stocks has more risk premium than cyclical stock. Also per my understanding non-cyclical stocks are more expensive than cyclical. Usually they have higher PE multiples etc. Aren’t these two concepts are conflicting i.e. Higher price & higher risk premium? When we say non-cyclical stocks have more risk premium which means required rate of return has also increase. We also know that price = (Cashflow/ Requried rate of return) so higher denominator means low price but we all know that price of non-cyclical are higher than cyclical under normal circumstances.
Please someone explain this to me what i am not getting here