Seven candidates with published target prices, plus the three Investor AB holdings named as its content and Constellation Software as the Lifco template. Research legend: QT Qualtrim · SA Seeking Alpha · STK Stock Analysis. Written post with no timestamps — the At link opens the article.
| Ticker | Name | Research | View | What he said | At |
|---|---|---|---|---|---|
| KKR | KKR & Co. | QT · SA · STK · FA | Positive | The one name in the 21-company series judged buyable now. "KKR is currently trading near its average Forward P/E over the past decade. I would say KKR is at or very near an interesting price to buy", with insider buying as corroboration. Scale and structure: $744bn AUM across private equity, real estate, infrastructure and credit since 1976; the Global Atlantic life insurer supplies $321bn of permanent capital — "money that never leaves"; and 92% of AUM sits behind 7-12 year lockups, so "they don't have to worry about investors panicking and pulling their money out during a market crash." Fundraising: $129bn raised in 2025, with over $115bn a year expected. The bear case is answered numerically: "the stock is down nearly 21% this year due to fears around private credit. But KKR's actual direct lending exposure is just 21% of assets. This looks like an overreaction." Becomes Best Buy #1 a week later. | read ↗ |
| INVE-B.ST | Investor AB | QT · SA · STK | Neutral | The Wallenberg family's listed holding company — "a holding company, a type of asset that often trades at a discount to the assets it owns" combined with "a family owned business, meaning there's a lot of skin in the game." Content: significant stakes in Atlas Copco, ABB and AstraZeneca — "the best of Europe in a single share… effectively a curated fund run by one of the most proven families in European business." Record: earnings up "nearly 25% per year" over a decade, the stock nearly doubled in five years, and a growing dividend "that has never been cut", on very little debt. The risk is stated plainly: ~70% of the portfolio is listed securities, so NAV falls with markets. Price: "the stock trades near its intrinsic value"; the entry level is 0.9x book = ~281 SEK against 372 SEK. | read ↗ |
| LIFCO-B.ST | Lifco AB | STK | Neutral | "It's the Swedish Constellation Software" — a decentralised serial acquirer of small niche businesses in dental supplies, demolition tools and systems solutions, buying "the #1 or #2 company in these small markets" and holding them. Record: revenue "more than 13% every year for a decade", EPS "more than 16% every single year". Moat: targets "too small for larger players to even look at", with high switching costs (dental implant systems) or standard-setting positions (demolition robots). Balance sheet: interest coverage 10.0x, debt-to-equity 0.3x. Alignment: Carl Bennet owns 50%, "the chairman has over half his wealth tied to Lifco's success." Price: "Lifco is never a cheap company. Since 2020, the cheapest it's gotten was a Forward P/E of 20x" — the target, implying 191 SEK against 304 SEK. | read ↗ |
| MELI | MercadoLibre | QT · SA · STK · FA | Neutral | "The Amazon of Latin America": 150 million active buyers in 18 countries, against a market where "85% of shopping still happens in physical stores." Two reinforcing engines — the marketplace (commissions plus shipping fees, with the Mercado Envios logistics network built for a region "where shipping is notoriously difficult") and Mercado Pago (payments, loans, cards, wallets, monthly active users +30% a year, loan book nearly doubled in 2025). Revenue grows "30% to 40% every year." Price: "currently trades near the lowest Forward P/E we've ever seen. But a Forward P/E of nearly 37x is still expensive"; target under 30x = $1,560 against $1,835. | read ↗ |
| MSCI | MSCI Inc. | QT · SA · STK · FA | Neutral | "A toll booth on Wall Street" — over $18trn of assets benchmarked to MSCI indices, with a fee on every fund that tracks one, plus analytics and ESG data. ~97% of revenue is subscription or index-linked, and "nearly 50 cents in cash from every dollar in revenue." Switching costs are social as much as technical: "clients and analysts expect it. Switching would cause outflows." The valuation history is the argument: "MSCI got quite expensive starting in 2019. As a result, the stock has been moving sideways for the past 5 years. The price is up 20% during that time, even though revenue has almost doubled." Target 25x forward = $486 against $592. | read ↗ |
| SYK | Stryker Corporation | QT · SA · STK · FA | Neutral | A razor-and-blade medical device business across orthopaedic implants, neurotechnology and surgical equipment: place the equipment, then earn on disposables, implants and service. The moat is training — "surgeons learn on Stryker tools during their training and stick with them for their careers", and switching means retraining, lower theatre efficiency and higher patient risk. Robotics: a three-year head start with the Mako surgical robot, with Q3 2025 its best quarter ever for new installations. Grown faster than its market for ten consecutive years at ~10% revenue growth, defended by 5,800 patents. Price: was over 50x, now "still over 30x trailing earnings. Expensive, but starting to get more reasonable"; target 20x forward = ~$283 against $327. | read ↗ |
| TDG | TransDigm Group | QT · SA · STK · FA | Neutral | "A collection of mini-monopolies": 100+ niche aviation businesses where 90% of revenue comes from products TransDigm is the only supplier of. The pricing mechanism is spelled out — parts "cost a tiny fraction of what a plane costs, [so] airlines barely notice the bill. So TransDigm raises prices 5-6% every single year." Record: 27.4% a year since the 2006 IPO — "$10,000 invested at IPO is now worth $1.3 million." Tailwind: Boeing and Airbus can't build fast enough, so older planes fly longer and consume more parts. Structure: "a Private Equity model in a public stock" — debt to buy, cash flow to repay, repeat. Target 25x forward = ~$1,000 against $1,148. Later ranked Best Buy #2 in August. | read ↗ |
| CSU.TO | Constellation Software | QT · SA · STK · FA | Neutral | Named as the template Lifco is measured against — "a page right out of Constellation Software's playbook", and "it's the Swedish Constellation Software." A Very Strong holding elsewhere; no fresh view here. | read ↗ |
| ATCO-A.ST | Atlas Copco | STK | Neutral | Named once, as one of the three "Swedish industrial champions" Investor AB owns — "Atlas Copco (industrial tools)". No stance. | read ↗ |
| ABBN.SW | ABB Ltd | STK | Neutral | Named once, as an Investor AB holding — "ABB (robotics)". No stance. | read ↗ |
| AZN.L | AstraZeneca | QT · SA · STK | Neutral | Named once, as an Investor AB holding — "AstraZeneca (medicine)". No stance. | read ↗ |
Series arithmetic, worth recording. Across Part I, Part II and this issue, 21 companies have been given a published entry price and exactly two sit inside their own limit — 3i Group (at a small NAV discount) and KKR (at its ten-year average multiple). Both survive into the 28 April shortlist of five, and both are ranked #1 and #2 in the May Best Buys. That is a consistent chain from screen to ranking. What did not follow is the purchase: the 30 April transaction put $50,000 into three existing holdings instead, and 3i Group only reaches the Buy-Hold-Sell list on 7 May.
A jargon-free summary of the thesis behind each argued name. (Renders on each name's consolidated page.)
KKR takes money from big institutions — pension funds, insurers, sovereign funds — and uses it to buy companies, infrastructure and property, or to lend privately. It charges an annual fee on the money it manages and keeps roughly a fifth of the profits when an investment is sold well.
Two structural features make it unusually safe for its type. It bought a life insurer, Global Atlantic, which gives it $321 billion of money that never has to be given back — it can invest that permanently and keep all the returns. And 92% of the $744 billion it manages is locked up for seven to twelve years, so even in a crash investors cannot pull it out. An asset manager that cannot suffer a run has far steadier earnings than one that can.
The opportunity is that the shares have fallen 21% this year because investors are worried about private credit blowing up. But actual direct lending is only 21% of what KKR manages, so the whole company has been marked down for a fifth of it. The valuation is simply back to its ten-year average, insiders have been buying, and the verdict is that this is "at or very near an interesting price to buy" — the only one of twenty-one companies across the three shopping lists to clear its own bar.
Investor AB is the Wallenberg family's vehicle for owning large stakes in Sweden's biggest industrial companies — AstraZeneca in medicine, Atlas Copco in industrial tools, ABB in robotics — plus some unlisted businesses. Buying one share gets you a slice of all of them.
Two things make it appealing. Holding companies like this usually trade for less than the sum of what they own, so you can buy the underlying businesses at a discount. And the family has controlled it for generations, which means the people allocating the capital have their own fortune riding on it and think in decades.
The record supports it: profits up nearly 25% a year over the past decade, the share price close to doubled in five years, and a dividend that has risen and never been cut. There is very little debt, which means it can buy more when markets fall rather than being forced to sell.
The risk is the obvious one and it is stated plainly: about 70% of what it owns is quoted shares, so when markets drop, so does its value. The stated buying level is 0.9 times book value, roughly 281 Swedish kronor against a market price of 372 — so not today.
Lifco buys small, profitable, unglamorous companies — dental supplies, demolition tools, specialised industrial systems — and leaves them to run themselves. It targets the number one or number two firm in markets so small that big acquirers never bother looking. Then it does it again, over and over.
It is described here as the Swedish version of Constellation Software, which this portfolio already owns, and the numbers back that up: revenue growing more than 13% a year for a decade and profits per share more than 16%. Its balance sheet is conservative — interest covered ten times over, low debt — which is what lets it keep buying.
The alignment is unusually strong: chairman Carl Bennet owns half the company and has more than half his personal wealth in it.
The catch is that quality of this sort is never on sale. Since 2020 the cheapest Lifco has ever been is 20 times forward earnings, and that is the stated buying level — about 191 kronor against a market price of 304. In other words, wait for a repeat of the worst moment of the last six years.
MercadoLibre is Latin America's dominant online marketplace — think Amazon for the region — with 150 million active buyers across 18 countries. It takes a commission on what is sold and a fee for shipping it, and it built its own delivery network because the region's postal and courier services are unreliable.
Attached to it is a financial business, Mercado Pago, which handles payments and now also lends money, issues cards and runs digital wallets. In a region where a large share of people have no bank account, that is a second business growing about 30% a year, with the loan book nearly doubling last year.
The growth runway is a simple statistic: 85% of shopping in Latin America still happens in physical shops. Revenue grows 30-40% a year and there is a long way to go.
The block is price. Even at the lowest valuation in its history, it costs nearly 37 times next year's profits, which is judged still expensive. The stated buying level is under 30 times, about $1,560 against a market price of $1,835.
MSCI builds the stock market indexes that funds measure themselves against — the MSCI World, for instance. Every fund or ETF that tracks one pays MSCI a fee, and more than $18 trillion is benchmarked to them. It also sells data and analytics software to the same customers.
Once a fund is tied to an MSCI index it almost never switches, and the reason is social rather than technical: clients and analysts expect that benchmark, and changing it would look like moving the goalposts and trigger withdrawals. About 97% of revenue is subscriptions or index-linked fees, and roughly half of every dollar of revenue turns into cash.
The interesting part is what has happened to the shares. Over five years the price is up 20% while revenue has almost doubled. The business kept compounding; investors simply became willing to pay a much lower multiple for it. That gap between a business improving and a share price not moving is exactly the situation this portfolio is betting on across its holdings.
Still not cheap enough, though. The stated buying level is 25 times forward earnings, about $486 against a market price of $592.
Stryker makes medical equipment: hip and knee implants, brain-surgery tools, hospital beds and surgical instruments. It sells the equipment once and then earns steadily from the implants, disposables and servicing that follow — the razor-and-blades pattern.
Its strongest protection is how surgeons are trained. A surgeon learns on particular instruments during training and generally uses that brand for a whole career; switching means retraining, working more slowly, and accepting more risk for the patient. That is a moat that renews itself with every new cohort of doctors.
It also got a three-year head start installing its Mako surgical robot in hospitals for knee and hip replacements, and once a hospital has one, the follow-on consumables come with it. Q3 2025 was its best quarter ever for new installations. It has grown faster than its market for ten years running, at about 10% a year, protected by 5,800 patents.
The shares used to cost over 50 times earnings and now cost just over 30 — cheaper, but still not cheap. The stated buying level is 20 times forward earnings, roughly $283 against $327.
TransDigm buys small companies that make specific aircraft parts, and it deliberately buys the ones where it will be the only legal supplier. Ninety per cent of its revenue comes from parts nobody else is allowed to sell. Aircraft stay in service for decades and parts wear out, so airlines and air forces have to keep buying.
The pricing trick is worth understanding because it generalises. Each part costs almost nothing relative to an aeroplane, so an airline barely notices a price rise on it and will not go to war over a few thousand dollars. TransDigm therefore raises prices 5-6% a year, every year, and nobody stops it. Since going public in 2006 the shares have compounded at 27.4% a year — $10,000 at the IPO would be $1.3 million now.
It funds acquisitions with borrowed money, then uses the cash the acquired businesses throw off to repay the debt and buy more — the way a private equity firm operates, run inside a listed company. That is described here as an attraction; it is also the reason a downturn would hurt more here than at a debt-free peer, and no leverage figures are given.
The stated buying level is 25 times forward earnings, about $1,000 a share against a market price of $1,148.
Summary derived from the archived Compounding Quality post (text in transcript.txt) for personal study. Not investment advice. © Compounding Quality / Pieter Slegers for source material.