Growth Present Value (PV)
1428.5
Post-shock discounted cash flows & terminal premium
Value Present Value (PV)
892.4
Front-loaded low-duration cash flow streams
Spread Ratio (Growth / Value)
1.6
Relative valuation multiple advantage
Reinvestment Yield Buffer
6.85%
Growth Attractive (Rate Buffer Active)
Discounted Cash Flow Trajectory & Horizon Curves
Annual discounted cash flows comparing high-CAGR growth vs near-term cash generation under current interest rate shock.
Valuation Metrics & Mechanics
Effective Discount Rate (r)
5.25%
Growth Terminal Premium Share
Value Front-Loaded Yield
5.9%
Equity Hurdle Spread
+685 bps
Valuation Resilience Verdict
GROWTH BUFFER ACTIVE
Why Growth Stays Attractive As Rates Rise
Conventional textbook finance dictates that long-duration assets suffer most when discount rates spike. However, when reinvestment return (14.5% CAGR) dramatically exceeds the marginal cost of capital (5.25%), the compound organic expansion easily outpaces discount rate drag.