What is the fundamental value of a stock?

The value of a stock depends on how every potential trader/investor values it. We have no way of knowing how every potential trader/investor values a stock, even if they have perfect information about its future operations and profitability. Therefore, there is no way that one can determine the fundamental value to a stock, which changes with the traders/investors' values.

Assumption:

1. Let us assume perfect information about the future operation and profitability of a company P.
2. But we don't know how everyone else value P.
3. Investors are not homogeneous.

Proposition:

We are in no position to assess the fundamental value of company P.

Reasons:

1. From a game theoretical point of view, the fundamental value is only a subgame perfect equilibrium in a multi-player game. It depends on how others value the same stock.
2. Even if everyone has a crystal ball, i.e. know the return of a company in every year in the future (Assumption 1), they would have different valuations of this company. The price that an investor is willing to pay now is the net present value of all the income that he/she will get from this company in the future. But everyone has a private discount rate in working out the net present value. These discount rates may vary (Assumption 3).
3. The price of the stock does not only depend on the return of the company in future years. It also depends on the valuation of the other traders. This is because their valuation determines how much they are willing to pay for the asset in the future.
4. We don't know everyone's valuation (Assumption 2).
5. Therefore, we have no way to value a company.

I assume that someone else has said this before?

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