Fast growers: value them like options
Weigh how big it could get, the odds of getting there, how long it takes, and whether a profitable core holds up the downside
Odds: bad 30%, base 50%, good 20%
Probability-weighted value$52.40
Expected return a year18.0%
- CeilingGood case is 15.0x: at least 10x
- Expected value18.0% a year clears the 9% hurdle
- FloorBad case keeps $8: a profitable core holds it up
Passes all three gates
Why it matters
A P/E alone can’t value a fast grower. In 2026 Palantir traded at about 150 times earnings, yet our numbers said: a great company, fairly priced, returning about −4% to 20% a year over three years.
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