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I’m Pieter and welcome to a 🔒 subscriber-only edition 🔒 of Compounding Quality.
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Warren Buffett is amazing.
Since he acquired Berkshire Hathaway in 1965, the stock has increased by 35,000,000%.
This means an investment of $10,000 turned into $3.5 billion!
Over the past 10 years, there have been a few great companies that did even better than Warren Buffett.
Let’s dive in and find out.
10. Rollins ($ROL)
Rollins provides pest and termite control services through its well-known brands like Orkin. Serving both residential and commercial clients, the company ensures pest-free environments with comprehensive and trusted solutions.
Why is Rollins a good company?
Rollins and its main peer Terminix dominate the entire industry
Expected long-term growth: 13.0% per year
Rollins Owner’s Earnings increased by 14.7% over the past 10 years*
Source: Finchat
* Owner’s Earnings = EPS Growth + Dividend Yield
9. Watsco ($WSO)
Watsco is the largest distributor of HVAC/R products in the Americas. The company provides essential components for heating, cooling, and refrigeration. Its expansive distribution network ensures timely delivery to contractors and technicians.
Why is Watsco a good company?
Serial acquirer with a decentralized business model
Albert Nahmad has been the CEO since 1972 (!)
Watsco’s Owner’s Earnings increased by 15.0% over the past 10 years
You can read the entire investment case of Watsco here.
8. Intuitive Surgical ($ISRG)
Intuitive Surgical is a pioneer in robotic-assisted surgery. Intuitive's da Vinci systems are used by hospitals worldwide to perform minimally invasive procedures. The company's innovation has transformed surgery with precision and efficiency.
Why is Intuitive Surgical a good company?
Net cash position and great capital allocation skills
Attractive growth: the company should be able to grow by > 10% in the years ahead
Intuitive Surgical’s Owner’s Earnings increased by 17.6% over the past 10 years
Source: Finchat
7. Pool Corporation ($POOL)
As the world's largest wholesale distributor of swimming pool supplies and related products, Pool Corp serves over 120,000 customers globally, helping keep pools clean, safe, and fun.
Why is Pool Corporation a good company?
One of the best-performing stocks within the S&P 500 ever
A lot of their sales are recurring in nature (around 60%)
Pool Corporation’s Owner’s Earnings increased by 20.6% over the past 10 years
6. Interactive Brokers ($IBKR)
Interactive Brokers is an electronic brokerage firm offering trading platforms for professional and retail traders.
Known for its low commissions and extensive market access, it caters to investors looking for a comprehensive trading experience.
I use Interactive Brokers myself so I know the company quite well. You can discover more here.
Why is Interactive Brokers a good company?
More people have started to see the importance of investing and IBKR benefits from this
IBKR is very efficient and is one of the lowest-cost brokers that are available
Interactive Brokers’s Owner’s Earnings increased by 20.6% over the past 10 years
Source: Finchat
5. Old Dominion Freight ($ODFL)
ODFL is a leading less-than-truckload (LTL) carrier.
The company's robust logistics network ensures efficient and reliable transportation services across North America, supporting businesses with timely freight deliveries.
Why is Old Dominion Freight a good company?
ODFL is the best-run LTL carrier in the United States
It’s almost impossible for other companies to compete with ODFL
ODFL Owner’s Earnings increased by 21.2%
4. Lululemon Athletica ($LULU)
Lululemon Athletica designs and sells high-quality athletic apparel.
Known for its innovative fabrics and stylish designs, the brand has cultivated a loyal following among fitness enthusiasts and casual wearers.
Why is Lululemon Athletica a good company?
Net cash position and great capital allocation skills (ROIC: 33.5%)
Lululemon grows consistently faster than competitors like Nike and Adidas
Lululemon Athletica’s Owner’s Earnings increased by 22.2% over the past 10 years
Source: Finchat
Now let’s dive into the top 3.