Valuing Company B Is Hard to Do

The ability to formulate precise forecasts does not necessarily make something a better, or even a safer investment. Value investing is thought of as trying to put a precise value on the low priced securities of possibly mundane companies and buying if their prices lower. Growth investing is thinking of buying on the basis of blue sky estimates regarding the potential of highly promising companies. And paying high valuations as the price of their potential rather than being defined as one side of this artificial dicodomy.