Value strives to represent the intrinsic worth of an asset, whereas price is what a buyer has actually paid for it. Recall the words of Warren Buffett: “Price is what you pay; value is what you get.” Prices change daily; value is more stable.

The key point is that the price paid for an asset or a company does not always reflect its underlying value, but rather the zone of agreement between a buyer and a seller at a given point in time. By contrast, value is linked to objective factors existing beyond the deal, as illustrated by the metric known as a valuation multiple.