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Markets, Valuations, and Prices
In modern finance theory, it is hard not to notice the tendency to expect the solution of classical corporate valuation problems from an increasing perfection, completeness, and information efficiency of markets. The market is considered to be the highest authority of economic and business sciences -- that's why it is intuitive at first sight to let the decision value [decision value refers to corporate valuation] be calculated from the market price. Such a point of view, however, misjudges that financial transactions are taking place exactly because of value and price differing from each other: If the price exactly conformed with the value of the corporation, the purchase does not have any advantage and may as well not take place. But the events on financial markets live on the fact that buyer and seller each believe to conduct an advantageous trade at the agreed price. Thus, the existence of market prices does not solve the valuation problem because usually (subjective) value and (objective) price differ from each other.
Source of the quote: Translation of a paragraph from the Fernuniversität course "Corporate Valuation" (original title: "Unternehmensbewertung") by Prof. Hering, course material 1, p.10