Title: Buy-Hold-Sell List: July 2026 Show: Compounding Quality (Substack, paid post — compoundingquality.net) Guest: Pieter Slegers / Team Compounding Quality (author; signed "Team Compounding Quality") Date: 2026-07-09 URL: https://www.compoundingquality.net/p/buy-hold-sell-list-july-2026 Length: written post — no timestamps Note: Paid-subscriber post captured via Stephen's logged-in session. Body text verbatim; UI chrome removed. Charts noted inline as [Image — ...]. The watchlist spreadsheets are published as images and are transcribed below as [Table image — ...] blocks: the ten worst and ten best performers, the full 54-stock BUY list with every model column, the three "most undervalued" screens, and the portfolio conviction/valuation sheet (19 holdings, KKR added since June). The in-article heading over the update section still reads "June 2026" in the original — a typo carried over from the previous issue.
How do you think wealth is created?
Wealth is created when Mr. Market offers you wonderful companies at a fair price.
This is definitely the case for some stocks in our Buy-Hold-Sell list today.
World War II
In September 1939, the world was falling apart.
World War II was starting.
Newspapers predicted an economic collapse and stock markets were falling.
Most investors were paralyzed with fear.
But John Templeton picked up the phone and placed one of the boldest trades in investing history.
He borrowed $10,000 and bought 100 shares of every single stock trading below $1 on the New York Stock Exchange.
In total, he bought 104 companies. 34 of them were in the process of going through a bankruptcy.
His friends thought he'd lost his mind.
[Image — Sir John Templeton]
Four years later, Templeton had turned that $10,000 into $40,000.
He quadrupled his money while the world was literally at war.
He didn't invest in hot stocks. He didn't chase the headlines.
He bought boring, beaten-down businesses when everyone else was selling.
That's the thing about looking dull in a bull market.
It feels embarrassing. It feels like you're missing out.
The investors who look the most boring today are often the ones who make history tomorrow.
As the famous Warren Buffett quote goes:
[Image — Buffett quote]
Quality stocks are selling cheap
The most volatile, speculative stocks are hitting all-time highs.
The most fundamentally sound companies are sitting near multi-year valuation lows.
Sound familiar right?
Mr Market is rewarding momentum while it is punishing patience.
History tells a clear story: every period of quality underperformance has eventually been followed by a sharp reversal.
When the rotation comes, it comes fast.
We have already seen this over the past few weeks.
In the past month:
Interparfums: +35.1%
Brown & Brown: +26.9%
Medpace: +23.7%
...
[Image — quality versus momentum. Source: CCLA, Bloomberg]
Templeton once said: The time of maximum pessimism is the best time to buy.
We're not at maximum pessimism.
But we are at a maximum discrepancy (the difference between quality and momentum).
That's almost as good.
Let's look at Dino Polska
Dino Polska can be seen as 'the Costco of Poland'.
It runs a network of medium-sized grocery stores in Poland, located close to where people live.
It runs in a simple model that is hard to disrupt.
Over the past year, the stock is down over 40%:
[Image — Dino Polska share price. Source: Fiscal.ai]
And here's what the business has done over the same period:
Revenue: +15%
New stores opened: 345
In the past 10 years, EPS has grown by 19.3% per year and the ROIC is well-above 15%.
The company now trades at its lowest valuation level ever:
[Image — Dino Polska valuation. Source: Fiscal.ai]
Mr. Market is punishing Dino Polska.
Nobody wants to own a boring Polish grocery stores when you can buy SpaceX at 90x revenue.
In the meantime, Dino Polska will silently keep growing:
[Image — Dino Polska growth. Source: Fiscal.ai]
So what can we expect from Dino Polska?
I expect an EPS of 2.4 PLN in 2028.
If we assume a FWD PE of 20x, this would imply a stock price of 48 PLN (current stock price: 28.7 PLN).
This means the upside potential equals 70%, implying a yearly return of over 20%.
Update Buy-Hold-Sell List: June 2026 [sic — the July update]
Let's now update our Buy-Hold-Sell List.
Worst performers
Here are the 10 worst performers on our watchlist so far this year:
[Table image — 10 worst performers YTD (Company / Ticker / YTD / 5-year CAGR / 10-year CAGR): EPAM Systems EPAM -56.0% / -29.9% / 3.6% Kelly Partners Group KPG -55.1% / 3.9% / 11.9% CoStar Group CSGP -54.4% / -18.6% / 3.3% lululemon athletica LULU -43.9% / -20.5% / 4.9% Gartner IT -42.5% / -11.7% / 3.4% Hamilton Lane HLNE -41.6% / -1.1% / 17.3% Zoetis ZTS -40.7% / -16.5% / 4.6% Adyen ADYEN -38.8% / -16.2% / 8.1% Admicom ADMCM -37.2% / -20.3% / 11.7% ATOSS Software AOF -35.4% / -3.3% / 17.6%]
Best performers
The 10 best performers look as follows:
[Table image — 10 best performers YTD (Company / Ticker / YTD / 5-year CAGR / 10-year CAGR): Fortinet FTNT 100.1% / 25.4% / 37.8% ASML Holding ASML 60.0% / 23.2% / 33.6% Keysight Technologies KEYS 51.9% / 15.3% / 27.2% LEM Holding LEHN 49.6% / -24.5% / -6.9% Interparfums IPAR 39.7% / 13.6% / 15.6% Old Dominion Freight Line ODFL 36.8% / 11.9% / 26.9% Monarch Casino & Resort MCRI 35.5% / 18.0% / 19.6% The RMR Group RMR 35.4% / -1.9% / -4.2% W.W. Grainger GWW 33.8% / 25.9% / 19.5% Watts Water Technologies WTS 32.3% / 21.5% / 20.5%]
Changes to the Buy-Hold-Sell list
Now let's look into the changes on our watchlist.
We added three more amazing companies to our watchlist:
Xylem ($XYL): US-based water technology company
Ferrari ($RACE): Luxury sports car manufacturer
Schneider Electric ($SU): Industrial automation company
Currently there are 54 stocks on 'Buy'.
This number has never been higher.
You can download the entire Buy-Hold-Sell List here: Buy-Hold-Sell
54 Stocks to Buy
You can see all the companies that are on 'Buy' right now here.
[Table image — the full 54-stock BUY list. Columns: Company / Ticker / Advice / Earnings Growth Model (EPS growth, dividend yield, FWD PE, fair exit PE, expected return, fair value, stock price, over/undervaluation) / Forward PE (current, 5-year average, over/undervaluation) / Reverse DCF (required growth, expected growth, difference) / Stock return (YTD, 5-year CAGR, 10-year CAGR). All 54 carry the advice BUY.
Adobe ADBE — EPS growth 12.3%, FWD PE 8.5, fair exit PE 20.0, ER 25.8%, FV 529.2 vs price 220.0 = 58.4% undervalued; fwd PE 8.5 vs 30.9 = 65.0% under; RDCF -1.2% vs 12.3% (+13.5pp); YTD -34.0%, 5y -18.1%, 10y 8.8% Adyen ADYEN — 15.0%, 24.9, 25.0, ER 15.0%, FV 1716.9 vs 855.0 = 50.2%; 24.9 vs 64.3 = 61.3%; RDCF 6.7% vs 15.0% (+8.3pp); YTD -38.8%, 5y -16.2%, 10y 8.1% Alarm.com ALRM — 6.9%, 15.9, 25.0, ER 12.6%, FV 59.7 vs 49.8 = 16.7%; 15.9 vs 33.3 = 52.3%; RDCF 2.5% vs 6.9% (+4.4pp); YTD -2.9%, 5y -10.5%, 10y 6.6% Ameriprise Financial AMP — 9.8%, 11.0, 11.7, ER 11.8%, FV 591.3 vs 489.2 = 17.3%; 11.0 vs 11.7 = 6.0%; RDCF 1.1% vs 9.8% (+8.7pp); YTD -0.9%, 5y 16.4%, 10y 18.9% Automatic Data Processing ADP — 6.0%, 17.3, 25.0, ER 13.3%, FV 313.4 vs 242.2 = 22.7%; 17.3 vs 27.9 = 38.0%; RDCF 5.1% vs 6.0% (+0.9pp); YTD -4.2%, 5y 6.1%, 10y 10.0% Berkshire Hathaway BRK.A — 3.0%, 23.3, 20.0, ER 1.6%, FV 384,039.4 vs 760,590.0 = -98.1%; 23.3 vs 22.5 = -3.6%; RDCF 4.4% vs 3.0% (-1.4pp); YTD -1.4%, 5y 2.2%, 10y 12.8% Brookfield Corporation BN — 12.0%, 46.0, 68.0, ER 17.4%, FV 122.6 vs 61.4 = 49.9%; 46.0 vs 45.0 = -2.2%; RDCF 5.4% vs 12.0% (+6.6pp); YTD -4.2%, 5y 13.5%, 10y 12.3% Brown & Brown BRO — 10.2%, 14.6, 20.0, ER 14.8%, FV 107.7 vs 70.0 = 35.0%; 14.6 vs 24.7 = 40.9%; RDCF 4.1% vs 10.2% (+6.1pp); YTD -9.8%, 5y 6.2%, 10y 14.3% Columbia Sportswear COLM — 8.0%, 17.4, 19.4, ER 11.1%, FV 70.0 vs 63.4 = 9.4%; 17.4 vs 19.4 = 10.3%; RDCF 1.9% vs 8.0% (+6.1pp); YTD 13.1%, 5y -7.4%, 10y 1.2% Computer Modelling Group CMG — 5.0%, 13.6, 20.0, ER 10.8%, FV 3.9 vs 3.7 = 5.5%; 13.6 vs 25.4 = 46.5%; RDCF -1.4% vs 5.0% (+6.4pp); YTD -30.1%, 5y -4.2%, 10y -9.8% Constellation Software CSU — 15.0%, 15.8, 20.0, ER 17.9%, FV 7329.5 vs 2779.4 = 62.1%; 15.8 vs 31.5 = 49.8%; RDCF 7.5% vs 15.0% (+7.5pp); YTD -14.2%, 5y 8.5%, 10y 18.5% Copart CPRT — 11.9%, 20.9, 25.0, ER 13.9%, FV 44.2 vs 29.9 = 32.3%; 20.9 vs 30.7 = 31.9%; RDCF 7.8% vs 11.9% (+4.1pp); YTD -20.8%, 5y -2.6%, 10y 17.1% Deckers Outdoor DECK — 7.0%, 14.0, 21.3, ER 12.2%, FV 122.0 vs 104.3 = 14.6%; 14.0 vs 21.3 = 34.3%; RDCF 3.1% vs 7.0% (+3.9pp); YTD -2.4%, 5y 10.1%, 10y 27.1% Dino Polska DNP — 15.0%, 17.7, 20.0, ER 16.3%, FV 64.8 vs 28.7 = 55.8%; 17.7 vs 24.9 = 28.9%; RDCF 10.6% vs 15.0% (+4.4pp); YTD -30.0%, 5y 0.1%, 10y 24.7% Domino's Pizza DPZ — 9.4%, 19.1, 25.0, ER 15.1%, FV 508.8 vs 311.0 = 38.9%; 19.1 vs 27.5 = 30.5%; RDCF 5.2% vs 9.4% (+4.2pp); YTD -26.9%, 5y -6.9%, 10y 8.8% Esquire Financial ESQ — 13.5%, 16.0, 15.0, ER 13.6%, FV 194.5 vs 120.3 = 38.1%; 16.0 vs 11.9 = -34.5%; RDCF 3.0% vs 13.5% (+10.5pp); YTD 18.8%, 5y 39.5%, 10y 25.7% Evolution AB EVO — 5.7%, 11.0, 15.0, ER 14.3%, FV 993.8 vs 677.8 = 31.8%; 11.0 vs 15.0 = 26.7%; RDCF -3.0% vs 5.7% (+8.7pp); YTD 8.6%, 5y -12.2%, 10y 29.4% Fairfax Financial FFH — 11.0%, 9.1, 8.0, ER 10.7%, FV 2615.2 vs 2409.5 = 7.9%; 9.1 vs 8.0 = -13.8%; RDCF 8.2% vs 11.0% (+2.8pp); YTD -7.5%, 5y 35.9%, 10y 13.5% Fair Isaac FICO — 10.0%, 22.7, 25.0, ER 11.0%, FV 1399.3 vs 1270.6 = 9.2%; 22.7 vs 40.9 = 44.5%; RDCF 13.0% vs 10.0% (-3.0pp); YTD -22.7%, 5y 19.7%, 10y 27.3% Fortinet FTNT — 12.0%, 28.9, 25.0, ER 10.7%, FV 168.5 vs 155.8 = 7.5%; 28.9 vs 42.7 = 32.3%; RDCF 9.1% vs 12.0% (+2.9pp); YTD 100.1%, 5y 25.4%, 10y 37.8% Gartner IT — 8.0%, 11.4, 25.0, ER 19.9%, FV 249.1 vs 136.3 = 45.3%; 11.4 vs 33.4 = 65.9%; RDCF -1.4% vs 8.0% (+9.4pp); YTD -42.5%, 5y -11.7%, 10y 3.4% Hamilton Lane HLNE — 3.4%, 15.1, 25.0, ER 13.0%, FV 97.1 vs 79.8 = 17.9%; 15.1 vs 25.5 = 40.8%; RDCF 4.9% vs 3.4% (-1.5pp); YTD -41.6%, 5y -1.1%, 10y 17.3% Intercontinental Exchange ICE — 12.0%, 19.5, 21.9, ER 14.8%, FV 233.0 vs 132.8 = 43.0%; 19.5 vs 21.9 = 11.0%; RDCF 6.4% vs 12.0% (+5.6pp); YTD -17.0%, 5y 3.7%, 10y 10.0% Interparfums IPAR — 10.0%, 18.6, 20.0, ER 13.5%, FV 175.8 vs 119.3 = 32.1%; 18.6 vs 26.3 = 29.3%; RDCF 3.0% vs 10.0% (+7.0pp); YTD 39.7%, 5y 13.6%, 10y 15.6% Kainos Group KNOS — 11.9%, 17.1, 25.0, ER 20.2%, FV 26.6 vs 8.0 = 69.9%; 17.1 vs 28.7 = 40.4%; RDCF 7.5% vs 11.9% (+4.4pp); YTD -19.2%, 5y -9.8%, 10y 19.4% Karooooo KARO — 9.6%, 21.7, 25.0, ER 13.9%, FV 81.9 vs 54.0 = 34.0%; 21.7 vs 34.6 = 37.3%; RDCF 7.9% vs 9.6% (+1.7pp); YTD 21.0%, 5y 10.9%, 10y 9.2% Kelly Partners Group KPG — 12.0%, 18.1, 25.0, ER 15.8%, FV 7.0 vs 4.0 = 42.1%; 18.1 vs 29.3 = 38.2%; RDCF 7.5% vs 12.0% (+4.5pp); YTD -55.1%, 5y 3.9%, 10y 11.9% Kinsale Capital KNSL — 11.0%, 17.2, 20.0, ER 12.9%, FV 474.5 vs 355.0 = 25.2%; 17.2 vs 28.6 = 39.9%; RDCF 4.1% vs 11.0% (+6.9pp); YTD -9.5%, 5y 15.6%, 10y 34.7% KKR & Co. KKR — 9.8%, 16.2, 17.9, ER 11.6%, FV 109.9 vs 94.0 = 14.5%; 16.2 vs 17.9 = 9.5%; RDCF 0.9% vs 9.8% (+8.9pp); YTD -27.1%, 5y 10.4%, 10y 22.8% lululemon athletica LULU — 7.4%, 11.2, 25.0, ER 19.7%, FV 209.5 vs 118.3 = 43.6%; 11.2 vs 33.1 = 66.2%; RDCF 2.1% vs 7.4% (+5.3pp); YTD -43.9%, 5y -20.5%, 10y 4.9% Markel MKL — 12.0%, 18.7, 17.6, ER 11.4%, FV 2331.2 vs 1981.5 = 15.0%; 18.7 vs 17.6 = -6.2%; RDCF 4.0% vs 12.0% (+8.0pp); YTD -7.0%, 5y 10.2%, 10y 7.8% Mastercard MA — 15.0%, 26.8, 25.0, ER 14.9%, FV 1140.6 vs 538.0 = 52.8%; 26.8 vs 32.6 = 17.8%; RDCF 10.1% vs 15.0% (+4.9pp); YTD -4.5%, 5y 8.1%, 10y 19.8% Medpace MEDP — 12.0%, 29.7, 25.0, ER 10.4%, FV 586.7 vs 557.6 = 5.0%; 29.7 vs 29.4 = -1.0%; RDCF 7.4% vs 12.0% (+4.6pp); YTD -2.4%, 5y 25.3%, 10y 35.3% MercadoLibre MELI — 15.0%, 36.3, 25.0, ER 11.9%, FV 2424.2 vs 1760.0 = 27.4%; 36.3 vs 48.4 = 25.0%; RDCF 10.1% vs 15.0% (+4.9pp); YTD -10.8%, 5y 2.5%, 10y 28.8% Microsoft MSFT — 15.0%, 24.5, 25.0, ER 16.1%, FV 971.7 vs 390.4 = 59.8%; 24.5 vs 30.1 = 18.6%; RDCF 8.1% vs 15.0% (+6.9pp); YTD -17.5%, 5y 7.9%, 10y 22.5% Mips AB MIPS — 15.0%, 30.5, 25.0, ER 14.2%, FV 538.5 vs 262.8 = 51.2%; 30.5 vs 59.6 = 48.8%; RDCF 12.0% vs 15.0% (+3.0pp); YTD -22.7%, 5y -18.4%, 10y 19.2% Moody's MCO — 11.5%, 27.6, 25.0, ER 11.4%, FV 574.1 vs 488.0 = 15.0%; 27.6 vs 32.7 = 15.6%; RDCF 10.2% vs 11.5% (+1.3pp); YTD -2.2%, 5y 6.6%, 10y 18.1% MSCI MSCI — 12.5%, 29.2, 25.0, ER 12.5%, FV 846.5 vs 603.1 = 28.8%; 29.2 vs 39.6 = 26.3%; RDCF 10.5% vs 12.5% (+2.0pp); YTD 6.7%, 5y 3.0%, 10y 22.9% Napco Security NSSC — 12.9%, 30.5, 25.0, ER 12.7%, FV 56.3 vs 37.8 = 32.9%; 30.5 vs 29.0 = -5.2%; RDCF 10.1% vs 12.9% (+2.8pp); YTD -8.7%, 5y 17.0%, 10y 28.0% Novo Nordisk NOVO B — 8.6%, 12.3, 20.0, ER 18.4%, FV 683.3 vs 332.0 = 51.4%; 12.3 vs 27.8 = 55.8%; RDCF 7.5% vs 8.6% (+1.1pp); YTD 0.5%, 5y 6.9%, 10y 6.1% Pool Corporation POOL — 8.1%, 21.2, 25.0, ER 12.2%, FV 270.2 vs 219.5 = 18.8%; 21.2 vs 27.3 = 22.3%; RDCF 6.1% vs 8.1% (+2.0pp); YTD -4.5%, 5y -12.8%, 10y 8.8% Qualys QLYS — 4.4%, 12.1, 25.0, ER 15.1%, FV 196.4 vs 148.2 = 24.5%; 12.1 vs 30.1 = 59.8%; RDCF 3.8% vs 4.4% (+0.6pp); YTD 13.1%, 5y 6.8%, 10y 17.2% RH RH — 11.0%, 25.0, 25.0, ER 11.0%, FV 187.7 vs 168.9 = 10.0%; 25.0 vs 25.8 = 3.1%; RDCF -1.1% vs 11.0% (+12.1pp); YTD -12.7%, 5y -24.6%, 10y 19.0% Sanlorenzo SL — 6.0%, 10.9, 14.2, ER 11.7%, FV 42.0 vs 35.8 = 14.8%; 10.9 vs 14.2 = 23.2%; RDCF -1.9% vs 6.0% (+7.9pp); YTD 18.0%, 5y 11.7%, 10y 13.0% Sonova SOON — 5.4%, 19.6, 25.0, ER 10.5%, FV 209.5 vs 202.0 = 3.6%; 19.6 vs 25.6 = 23.4%; RDCF 4.3% vs 5.4% (+1.1pp); YTD -3.0%, 5y -8.9%, 10y 4.6% S&P Global SPGI — 11.5%, 22.3, 25.0, ER 13.6%, FV 646.6 vs 438.4 = 32.2%; 22.3 vs 29.5 = 24.4%; RDCF 7.3% vs 11.5% (+4.2pp); YTD -14.5%, 5y 3.1%, 10y 15.2% SS&C Technologies SSNC — 10.5%, 10.3, 13.0, ER 14.7%, FV 104.7 vs 65.5 = 37.4%; 10.3 vs 13.0 = 20.8%; RDCF 1.0% vs 10.5% (+9.5pp); YTD -23.6%, 5y -0.9%, 10y 8.7% Tatton Asset Management TAM — 10.0%, 16.4, 20.0, ER 16.3%, FV 15.2 vs 7.3 = 51.6%; 16.4 vs 22.5 = 27.1%; RDCF 3.9% vs 10.0% (+6.1pp); YTD -10.5%, 5y 14.8%, 10y 16.3% Topicus.com TOI — 15.0%, 25.6, 25.0, ER 14.8%, FV 180.1 vs 92.2 = 48.8%; 25.6 vs 49.2 = 48.0%; RDCF 8.3% vs 15.0% (+6.7pp); YTD -26.3%, 5y 12.7%, 10y 7.2% TransDigm TDG — 10.7%, 30.8, 25.0, ER 15.5%, FV 4209.9 vs 1348.5 = 68.0%; 30.8 vs 34.7 = 11.2%; RDCF 10.1% vs 10.7% (+0.6pp); YTD -0.7%, 5y 12.7%, 10y 17.9% Visa V — 13.5%, 23.4, 25.0, ER 14.9%, FV 666.1 vs 361.6 = 45.7%; 23.4 vs 28.3 = 17.3%; RDCF 7.5% vs 13.5% (+6.0pp); YTD 4.4%, 5y 9.4%, 10y 17.1% XPEL XPEL — 15.0%, 22.0, 20.0, ER 14.1%, FV 88.2 vs 48.5 = 45.0%; 22.0 vs 32.6 = 32.5%; RDCF 4.3% vs 15.0% (+10.7pp); YTD -3.4%, 5y -10.3%, 10y 45.6% Zoetis ZTS — 7.0%, 16.2, 25.0, ER 15.2%, FV 112.5 vs 74.7 = 33.6%; 16.2 vs 31.7 = 48.9%; RDCF 4.1% vs 7.0% (+2.9pp); YTD -40.7%, 5y -16.5%, 10y 4.6% 3i Group III — 11.0%, 25.7, 30.0, ER 16.0%, FV 53.0 vs 25.9 = 51.3%; 25.7 vs 30.2 = 14.9%; RDCF 8.8% vs 11.0% (+2.2pp); YTD -19.5%, 5y 19.8%, 10y 16.5%]
16 out of the 19 companies that we own are a 'Buy' right now:
Medpace Holdings ($MEDP)
Evolution AB ($EVO)
Brookfield Corporation ($BN)
Brown & Brown ($BRO)
Dino Polska ($DNP)
Kinsale Capital ($KNSL)
Interparfums ($IPAR)
Ameriprise Financial ($AMP)
Visa ($V)
Topicus ($TOI)
Kelly Partners Group ($KPG)
Novo Nordisk ($NOVO-B)
Constellation Software ($CSU)
Zoetis ($ZTS)
3i Group ($III)
KKR & Co. ($KKR)
I truly believe some great opportunities can be found in the list above.
1) Forward P/E
Here are the most undervalued companies based on the Forward P/E:
[Table image — most undervalued on Forward PE (current fwd PE / 5-year average / undervaluation): Goosehead Insurance 20.8 / 76.0 / 72.6% Adobe 8.5 / 30.9 / 72.5% Paycom Software 12.2 / 43.8 / 72.1% EPAM Systems 8.8 / 30.8 / 71.4% CorVel Corporation 30 / 99.3 / 69.8% Paylocity 13.7 / 42.7 / 67.9% lululemon athletica 11.2 / 33.1 / 66.2% Gartner 11.4 / 33.4 / 65.9% CoStar Group 25.2 / 73.2 / 65.6% Adyen 24.9 / 64.3 / 61.3% Qualys 12.1 / 30.1 / 59.8% Insperity 10.4 / 25.2 / 58.7% FactSet Research Systems 11.5 / 27.3 / 57.9% Novo Nordisk 12.3 / 27.8 / 55.8% ATOSS Software 24.9 / 54.4 / 54.2%]
Adobe is currently trading near its lowest valuation level ever.
In late June, David Ricks, an Adobe board director and the CEO of Eli Lilly bought 10,000 shares of Adobe at a price of $194.5.
[Image — insider purchase. Source: Fiscal.ai]
Industry experts are concerned with AI disrupting Adobe's business.
But Adobe appears to be using AI strategically to further expand its ecosystem.
[Image — Adobe AI ecosystem. Source: Adobe Q2 2026 Presentation]
Fiscal estimates suggest Adobe can deliver double-digit revenue growth over the next few years.
For investors willing to take on more risk in pursuit of higher returns, Adobe could be worth considering.
[Image — Adobe estimates. Source: Fiscal.ai]
2) Earnings Growth Model
Here are the most undervalued companies based on our Earnings Growth Model:
[Table image — most undervalued on the Earnings Growth Model (EPS growth / dividend yield / FWD PE / fair exit PE / expected return): Adobe ADBE 12.3% / 0.0% / 8.5 / 20.0 / 25.8% CTS Eventim EVD 13.9% / 2.5% / 17.0 / 25.0 / 21.1% FactSet Research Systems FDS 6.9% / 1.9% / 11.5 / 25.0 / 20.5% Ares Management ARES 12.0% / 4.6% / 18.2 / 25.0 / 20.3% Kainos Group KNOS 11.9% / 3.7% / 17.1 / 25.0 / 20.2% Marimekko MEKKO 9.5% / 3.9% / 15.0 / 25.0 / 20.1% Gartner IT 8.0% / 0.0% / 11.4 / 25.0 / 19.9% Paycom Software PAYC 12.3% / 1.1% / 12.2 / 20.0 / 19.8% lululemon athletica LULU 7.4% / 0.0% / 11.2 / 25.0 / 19.7% Enghouse Systems ENGH 1.8% / 7.6% / 12.3 / 25.0 / 19.7% Admicom ADMCM 13.0% / 1.2% / 16.6 / 25.0 / 19.3% TransUnion TRU 13.9% / 0.6% / 14.7 / 21.8 / 19.3% DiaSorin DIA 10.2% / 1.9% / 14.6 / 25.0 / 19.2% Paychex PAYX 8.8% / 4.5% / 15.9 / 25.0 / 19.0% Insperity NSP 7.0% / 7.5% / 10.4 / 15.0 / 18.9%]
Ares Management is an interesting company that stands out.
They are an alternative asset manager with investments in private credit, private equity, real estate, and infrastructure investments.
Ares Management has consistently grown their assets under management, earnings, and dividends over the past years.
[Image — Ares Management. Source: Investor Presentation]
3) Reverse DCF
Here's a list of the most undervalued companies based on Our Reverse DCF:
[Table image — most undervalued on the reverse DCF (required growth / expected growth / difference): CTS Eventim EVD -1.9% / 13.9% / 15.8% Equasens EQS -2.0% / 12.7% / 14.7% Adobe ADBE -1.2% / 12.3% / 13.5% Gildan Activewear GIL 1.7% / 15.0% / 13.3% LEM Holding LEHN -1.9% / 11.0% / 12.9% RH RH -1.1% / 11.0% / 12.1% SDI Group SDI -1.9% / 10.0% / 11.9% Admicom ADMCM 1.2% / 13.0% / 11.8% New Wave Group NEWA B 3.3% / 15.0% / 11.7% TransUnion TRU 2.5% / 13.9% / 11.4% Nexstar Media Group NXST -1.3% / 10.0% / 11.3% Paycom Software PAYC 1.3% / 12.3% / 11.0% XPEL XPEL 4.3% / 15.0% / 10.7% Esquire Financial ESQ 3.0% / 13.5% / 10.5% InfraCom Group INFRA -1.5% / 9.0% / 10.5%]
The Big Picture
Today, 83 companies are undervalued on each valuation method.
This number has never been higher
[Image — the full watchlist coloured by valuation method]
Our Portfolio
Here's what the valuation for our Portfolio looks like:
[Table image — Our Portfolio: conviction (quality) and rating (valuation), 19 holdings. Medpace Holdings — Very Strong / BUY — ER 10.4%, FV 586.7 vs 557.6 = 5.0%; fwd PE 29.7 vs 29.4 = -1.0%; RDCF 7.4% vs 12.0% (+4.6pp) Evolution AB — Medium / BUY — ER 14.3%, FV 993.8 vs 677.8 = 31.8%; 11 vs 15 = 26.7%; RDCF -3.0% vs 5.7% (+8.7pp) Kelly Partners Group — Strong (+) / STRONG BUY — ER 15.8%, FV 7.0 vs 4.0 = 42.1%; 18.1 vs 29.3 = 38.2%; RDCF 7.5% vs 12.0% (+4.5pp) Brown & Brown — Strong (+) / STRONG BUY — ER 14.8%, FV 107.7 vs 70.0 = 35.0%; 14.6 vs 24.7 = 40.9%; RDCF 4.1% vs 10.2% (+6.1pp) LVMH — Strong / HOLD — ER 14.7%, FV 798.8 vs 498.0 = 37.7%; 19.9 vs 24.9 = 20.1%; RDCF 6.2% vs 9.6% (+3.4pp) Games Workshop — Very Strong / HOLD — ER 6.2%, FV 139.5 vs 214.8 = -54.0%; 33.1 vs 23 = -43.9%; RDCF 10.9% vs 7.0% (-3.9pp) Dino Polska — Strong / BUY — ER 16.3%, FV 64.8 vs 28.7 = 55.8%; 17.7 vs 24.9 = 28.9%; RDCF 10.6% vs 15.0% (+4.4pp) Kinsale Capital — Very Strong / STRONG BUY — ER 12.9%, FV 474.5 vs 355.0 = 25.2%; 17.2 vs 28.6 = 39.9%; RDCF 4.1% vs 11.0% (+6.9pp) Interparfums — Strong / BUY — ER 13.5%, FV 175.8 vs 119.3 = 32.1%; 18.6 vs 26.3 = 29.3%; RDCF 3.0% vs 10.0% (+7.0pp) Ameriprise Financial — Very Strong / BUY — ER 11.8%, FV 591.3 vs 489.2 = 17.3%; 11 vs 11.7 = 6.0%; RDCF 1.1% vs 9.8% (+8.7pp) Visa — Very Strong / BUY — ER 14.9%, FV 666.1 vs 361.6 = 45.7%; 23.4 vs 28.3 = 17.3%; RDCF 7.5% vs 13.5% (+6.0pp) Topicus.com — Very Strong / STRONG BUY — ER 14.8%, FV 180.1 vs 92.2 = 48.8%; 25.6 vs 49.2 = 48.0%; RDCF 8.3% vs 15.0% (+6.7pp) HgCapital Trust — Strong (+) / BUY — ER 16.2%, share price 3.88 vs NAV per share 5.6 = 31.0% discount (reverse-DCF columns marked "/") Novo Nordisk — Medium / STRONG BUY — ER 18.4%, FV 683.3 vs 332.0 = 51.4%; 12.3 vs 27.8 = 55.8%; RDCF 7.5% vs 8.6% (+1.1pp) Constellation Software — Very Strong / STRONG BUY — ER 17.9%, FV 7329.5 vs 2779.4 = 62.1%; 15.8 vs 31.5 = 49.8%; RDCF 7.5% vs 15.0% (+7.5pp) Brookfield Corporation — Very Strong / BUY — ER 17.4%, FV 122.6 vs 61.4 = 49.9%; 46 vs 45 = -2.2%; RDCF 5.4% vs 12.0% (+6.6pp) Zoetis — Strong (+) / STRONG BUY — ER 15.2%, FV 112.5 vs 74.7 = 33.6%; 16.2 vs 31.7 = 48.9%; RDCF 4.1% vs 7.0% (+2.9pp) 3i Group — Very Strong / BUY — ER 16.0%, FV 53.0 vs 25.9 = 51.2%; 25.7 vs 30.2 = 14.9%; RDCF 8.8% vs 11.0% (+2.2pp) KKR & Co. — Very Strong / BUY — ER 11.6%, FV 109.9 vs 94.0 = 14.5%; 16.2 vs 17.9 = 9.5%; RDCF 0.9% vs 9.8% (+8.9pp)]
There are Seven Strong Buys in our Portfolio today:
Kelly Partners Group ($KPG)
Brown & Brown ($BRO)
Kinsale Capital ($KNSL)
Topicus ($TOI)
Novo Nordisk ($NOVO)
Constellation Software ($CSU)
Zoetis ($ZTS)
Conclusion
That's it for today.
The main thing to remember? Quality stocks look very attractive today.
Here are the main changes in the Buy-Hold-Sell List:
3 Stocks were added: Xylem, Ferrari and Schneider Electric
7 Companies are a 'Strong Buy': Brown & Brown ($BRO), Kinsale Capital ($KNSL), Topicus ($TOI), Kelly Partners Group ($KPG), Novo Nordisk ($NOVO), Constellation Software ($CSU), Zoetis ($ZTS)
As a reminder, you can find the entire Buy-Hold-Sell List here: Buy-Hold-Sell
Everything In Life Compounds Team Compounding Quality
Book: Order your copy of The Art of Quality Investing here
Used sources Interactive Brokers: Portfolio data and executing all transactions Fiscal.ai: Financial data