That's not strictly correct Mak and for purely discussion purposes (and not having a go at you) I make the following points as I am sick and tired of the constant comments that the market has some mythical powers of being all knowing.
The share price is an estimate of value at a point in time. Potential value is an estimate of value in the future.
Informational efficiency theory suggests that the market knows most of the information available at any point in time but only on aggregate.
At any time there is much not known and takeover premiums are a classic case in point. In addition different valuation methodologies throw up different values ascribed for the same stock as do different methodologies and assumptions. You only have to look at broker reports to see that this is true.
In addition at any time a share can be over bought or over sold which in itself implies that the current value is incorrect. This is a standard technical indicator.
And Warren Buffett suggests to buy when other are fearful and sell when others are greedy. This implies that the psychological factors of the market at a point in time are also important.
So the above statements of fact show that price at a point in time may or may not be a true reflection of value. It reflects the current market price only.
Value investing suggests that at any time there are undervalued stocks in the market and I believe that on any metric SUT is one of them but that is just my opinion. However it is opinion that moves the market.
