If entering into a high-growth business at the introduction stage or early growth stage with a long runway for growth ahead (18+ years), even paying a very high price-to-earnings multiple still results in substantial profits because high growth bails out valuation contractions, but entering at the decline phase leads to sharp P/E de-rating and permanent loss of capital.

causalpending

Speaker

Gautam Baid

Evidence Quote

Even if you pay a very high P multiple, you still end up making a lot of money in such stocks because in such businesses, the high growth tends to bail you out.

Source

Investing in Quality Businesses & the Art of Lifelong Learning w/ Gautam Baid (TIP566)The Investor’s Podcast
Created: 8/12/2026, 10:28:19 PM

My Notes

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