[lordofmoria]

This was interesting, especially with the DCF example at the end - it’s pertinent to business sell decisions (assuming your ownership structure allows you to make a decision) should I sell at an 8x multiple of revenue, or hold at an X% growth rate and Y% cash flow? What’s my net after 10 years?

The point of Jensen’s inequality if I understand correctly is that you’d underestimate the value of holding using a basic estimate approach, because you’ll underestimate the compounding cash flow from growth?

[pfortuny]

It depends on whether future returns increase. One tends to draw the optimistic version of Jensen’s inequality (and in general, of convex curves), but it also applies to decreasing functions.