Mungo:
Any given stock has one true actual value, which takes into account all of its future growth and discounts it perfectly back to the present. Of course there is the minor disadvantage that you never know exactly what that number might be : ) ...but let's posit that there is such a number.

At that number, the "true value" of my example, the cash is worth exactly as much as the shares for which it is exchange, and there is no value gain, no matter how quickly (or slowly) the business grows after that, since that was taken into account in assessing the true fair value.

What you are saying presumes two things which are almost certainly not true:

1) There is one "true discount rate" that should be used by all traders and investors to attempt to determine the one "true value" of each investment.

2) All future cash flows are already determined now before they happen.

As for there being one "true discount rate", even among the minority of investors who use a somewhat formal Discounted Cash Flow (DCF) analysis to value assets, not only do they not all use the same discount rate, but many of them don't even use the same discount rate for every kind of asset! In fact we have been hearing for years that Berkshire would only do buybacks when the stock was trading at "25% to 30% less than it is worth." But despite going quantitative on the required discount, I'm betting no one on this board can state the discount rate Berkshire uses. Historically, the only thing Buffett has ever said about a discount rate is "the long-term U.S. Treasury Rate".

Is this concern that there does not seem to be one true discount rate trivial? I don't think so. Lets see an example of why. In 1964 BRK was ~$12 a share, 30 years later in 1994 it was $20,000 per share. That is a CAGR of 28%. Over that same period US Treasury long-term rates varied quite a bit, but compounded over that 30 years (using Damodaran's data) would have grown $270 in 1964 to $2000 in 1994 for a CAGR of 7%. So according to Buffett, an appropriate Discount rate for valuing BRK shrs over that 30 year period would be about 7%. Using that discount rate and looking at where Berkshire got to in 1994, that share of BRK that actually cost $12 in 1964 had an intrinsic value of more than $2,700!

Maybe somebody will object to this but I think the only way you could object to this would be to say, well NO ONE could have predicted that Berkshire would grow as much as it did. Oh, so future cash flows are NOT pre-determined? The future does not yet exist so there is no sense in which we can say one true DCF value exists even if we did agree on one single discount rate?

I'd imagine this seems like a pedantic point, meaning it doesn't change anything about what we are REALLY talking about. But I think it does. I think it means that talking about a "25% to 30% discount to what its really worth" is NOT referring to "one true value" which is mathematically found using DCF analysis taking into account all actual future cash flows.

For myself, these rabbit holes have lead me to believe that I should be investing primarily in companies that show a decade or more of 20%+ annual growth rate. Because with 20%+ annual growth rate, it doesn't take that many years to make virtually any stock price now look like a bargain.

Or else it means there is something else other than one true DCF that has to be brought to bear to evaluate investments.

R:)