Looking further out, value compounds while price is paid once. Discounted cash flow models make this explicit: the stream of future benefits dominates the single outlay when those benefits are resilient. Buffett’s 1989 letter put it crisply: it’s better to buy a wonderful company at a fair price than a fair company at a wonderful price.
Think of an orchard: the purchase price is the saplings; value is decades of fruit. If the trees are healthy and the soil rich—strong economics and sound management—the initial check becomes small relative to harvests. Thus, patience converts sensible prices into extraordinary value. [...]
