Stock Markets Apply a "Conglomerate Discount" of 20% on Unrelated

Stock markets apply a "conglomerate discount" of 20% on unrelated diversified firms. This means that investors

A) understand that the financial efficiencies of this strategy automatically make these stocks worth 20% more than their current market valuation.
B) believe that the value of conglomerates is 20% less than the value of the sum of their parts.
C) discount the expected future earnings of conglomerates by 20%.
D) have found that over time, conglomerates earn 20% more than the component companies would have earned independently.