On 14/10/2013 14:51:45,
Thanks for the comment, James. I can certainly see where you are coming from and I don’t think we are disagreeing with one another, but in effect the value today is ultimately reflective of how other investors should price the expected future cash flows. So for example, if we believe that a stock is undervalued today, we buy it in the hope that tomorrow other investors will revalue the business. This might result in a takeout or simply a rerating, but in each case the new value is usually linked to how these other investors value the cash flow that the business is expected to produce (either in a sale, or as an operating business).