Title: Update Buy-Hold-Sell List: May 2026
Show: Compounding Quality (Substack, paid post — compoundingquality.net)
Guest: Pieter Slegers / Team Compounding Quality (author; byline "Compounding Quality")
Date: 2026-05-07
URL: https://www.compoundingquality.net/p/update-buy-hold-sell-list-may-2026
Length: written post — no timestamps
Note: Paid-subscriber post captured via Stephen's logged-in session. Body text verbatim; UI chrome removed. Fiscal.ai chart panels noted inline as [Image — ...]. The watchlist performance tables, the 49-stock BUY table and the portfolio valuation table are published as images and are transcribed below as [Table image — ...] blocks; every figure is read directly from those images. Written the week after the Berkshire AGM in Omaha.

It's time to update our watchlist today.

We decided to add a few amazing companies to our Buy-Hold-Sell List.

Let's inspire you with some amazing investment ideas.

Mr. Market remains very bullish on AI.

At the Berkshire AGM in Omaha, some of the world's top investors warned that the market could be in serious trouble.

"The market is behaving more and more like a casino." - Warren Buffett

Big tech companies are making massive investments into AI, and the market seems to like it.

Just look at how these companies performed in April 2026:

NVIDIA (+20%): Stronger demand for AI chips and data center expansion

Microsoft (+14.7%): Deeper integration of AI across Azure and its product ecosystem

Alphabet (+21.7%): Strong growth in AI and the core advertising business

...

The S&P 500 rose 9.6% in April because of this.

[Image — S&P 500, April 2026. Source: Fiscal.ai]

But here's the thing...

By investing in the S&P 500, you are way less diversified than you might think.

The IT and Software sector accounts for 35% of the total weight

The 10 companies in the S&P 500 have a weight of 38.5%

[Image — S&P 500 sector and top-10 weights. Source: S&P Factset]

Today, No sector is left untouched by AI.

Look at this chart:

[Image — AI exposure by sector. Source: Secondtalent]

This brings us to the main question.

Who is winning the AI race?

This is a tough question. It's very hard to predict the winner.

As Buffett would say, predicting the winners of the AI race is in our 'too hard pile'.

The smartest thing to do if you ask me?

Use a pick-and-shovel strategy.

During the California Gold Rush (1848-1855), thousands of people dreamt of getting incredibly rich by finding gold.

But here's the thing...

Most miners never found gold.

It was unpredictable, risky, and mostly about getting lucky.

Who did make money reliably?

The guys selling picks, shovels, pans, and boots to the miners.

They sold the tools everyone needed regardless of who won.

A similar analogy can be used for AI.

Rather than betting on which AI company will "win," you invest in the infrastructure and tools that every AI company depends on.

Cloud computing: (AWS, Azure, Google Cloud) is required for models to run

Energy & power grids: AI data centers need enormous amounts of electricity

Cooling systems, fiber optic cables, data storage: are boring but essential

That's why I think a company like Brookfield Corporation ($BN) could be very interesting.

Brookfield builds and owns the physical world that AI runs on.

They own the land, the power, the buildings and the cables.

Data centers: Brookfield launched a $100 billion global AI infrastructure program

Energy & Power: Brookfield secured a $5 billion agreement with Bloom Energy to install up to 1 GW of behind-the-meter power solutions for data centers and AI factories

The Land & Scale: In Sweden alone, Brookfield signed a land allocation agreement for around 350,000 sqm of additional land, enabling a data center site to more than double its capacity from 300MW to 750MW

[Image — Brookfield Corporation price chart, 12 Aug 1997 - 7 May 2026 (28y 9m). TSX:BN Total Chg: 2,961.2% (CAGR: 12.6%). Current price CA$63.39. Source: Fiscal.ai]

Let's now update our Buy-Hold-Sell List.

Worst performers

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):
Kelly Partners Group Holdings Limited / KPG / -48.8% / 10.3% / 13.9%
CoStar Group, Inc. / CSGP / -47.1% / -16.4% / 5.9%
EPAM Systems, Inc. / EPAM / -44.0% / -24.5% / 4.7%
Gartner, Inc. / IT / -38.2% / -8.3% / 5.3%
Goosehead Insurance, Inc. / GSHD / -38.0% / -14.5% / 13.5%
Fair Isaac Corporation / FICO / -37.0% / 15.3% / 25.8%
lululemon athletica inc. / LULU / -36.6% / -16.3% / 7.4%
RH / RH / -32.8% / -28.3% / 12.7%
Qualys, Inc. / QLYS / -32.4% / -1.4% / 13.0%
Dunelm Group plc / DNLM / -32.4% / -4.7% / -1.6%]

We are currently looking into Fair Isaac.

The company trades at one of its cheapest valuations levels ever.

But there are also some serious risks involved.

We don't like the high level of stock-based compensation and the fact that FICO might lose its monopoly.

Best performers

The 10 best performers on our watchlist so far this year:

[Table image — 10 best performers YTD (Company / Ticker / YTD / 5 Year CAGR / 10 Year CAGR):
Ubiquiti Inc. / UI / 80.1% / 31.0% / 40.1%
Keysight Technologies, Inc. / KEYS / 70.6% / 20.2% / 29.8%
Westlake Corporation / WLK / 55.1% / 4.9% / 9.0%
HMS Networks AB (publ) / HMS / 34.1% / 9.3% / 25.6%
Arista Networks, Inc. / ANET / 29.4% / 55.3% / 46.0%
Old Dominion Freight Line, Inc. / ODFL / 29.3% / 9.8% / 25.5%
ASML Holding N.V. / ASML / 23.9% / 20.0% / 31.1%
Watsco, Inc. / WSO / 23.4% / 10.7% / 12.3%
The RMR Group Inc. / RMR / 22.7% / -4.5% / -3.2%
Monarch Casino & Resort, Inc. / MCRI / 22.5% / 12.7% / 19.9%]

It's once again a great reminder that you only need a few very big winners to be very successful as an investor.

Update Buy-Hold-Sell List

Now let's look into the changes on our watchlist.

We added two more amazing companies to our watchlist:

3i Group ($III): UK based investment holding company

Alphabet ($GOOGL): Global technology holding company

Two companies went from Hold to Buy:

Fairfax Financial Holdings ($FFH): Insurance holding company

Fair Isaac Corporation ($FICO): Credit scoring and analytics company

Four companies went from Sell to Hold:

Nathan's Famous ($NATH): Branded food and licensing company

Cintas ($CTAS): Business services company

Hermes ($RMS): French ultra-luxury fashion company

HEICO ($HEI): Aerospace and defense parts manufacturer

Currently there are 49 stocks on 'Buy'.

This number has never been higher.

Quality is on sale right now. We are more and more in bubble territory.

It could be the opportunity of a century.

[Image — Bloomberg Opinion, "Yet Another Record": US stocks at another record, driven by momentum while quality is ignored. Chart "Big Mo's Low-Quality Rally" showing FTW US All-Cap Momentum against FTW US All-Cap Quality, long-short total return from 04/02/2025 (Liberation Day) — momentum near +9%, quality near -25%. Source: Bloomberg Factors To Watch, via Rich Cohen in the Community]

You can download the entire Buy-Hold-Sell List here: Buy-Hold-Sell

49 Stocks to Buy

You can see all the companies that are on 'Buy' right now here (click on the picture to expand):

[Table image — the 49 BUY-rated stocks. Columns: Company / Ticker / Advice / Earnings Growth Model (EPS Growth, Dividend Yield, FWD PE, Fair exit PE, Expected Return, Fair value, Stock price, Over/Undervaluation).
Adobe Inc. / ADBE / BUY / 12.3% / 0.0% / 10.8 / 20.0 / 20.8% / 602.9 / 250.7 / 58.4%
Kainos Group plc / KNOS / BUY / 11.9% / 3.5% / 17.1 / 25.0 / 20.0% / 26.4 / 8.3 / 68.5%
Gartner, Inc. / IT / BUY / 8.0% / 0.0% / 11.4 / 25.0 / 19.9% / 267.5 / 146.4 / 45.3%
lululemon athletica inc. / LULU / BUY / 7.4% / 0.0% / 11.2 / 25.0 / 19.7% / 236.8 / 133.7 / 43.6%
Novo Nordisk A/S / NOVO B / BUY / 8.6% / 4.3% / 12.3 / 20.0 / 19.2% / 636.7 / 278.0 / 56.3%
Constellation Software Inc. / CSU / BUY / 15.0% / 0.2% / 15.8 / 20.0 / 17.9% / 6434.6 / 2440.0 / 62.1%
Brookfield Corporation / BN / BUY / 12.00% / 0.60% / 46 / 68 / 17.38% / 122.8 / 61.5 / 49.94%
Dino Polska S.A. / DNP / BUY / 15.0% / 0.0% / 17.7 / 20.0 / 16.3% / 72.5 / 32.1 / 55.8%
Tatton Asset Management plc / TAM / BUY / 10.0% / 3.9% / 16.4 / 20.0 / 16.1% / 12.4 / 6.2 / 50.0%
Qualys, Inc. / QLYS / BUY / 4.4% / 0.0% / 12.1 / 25.0 / 15.1% / 117.3 / 88.5 / 24.5%
Adyen N.V. / ADYEN / BUY / 15.0% / 0.0% / 24.9 / 25.0 / 15.0% / 1934.5 / 963.4 / 50.2%
Mastercard Incorporated / MA / BUY / 15.0% / 0.7% / 26.8 / 25.0 / 15.0% / 1072.8 / 494.5 / 53.9%
Brown & Brown, Inc. / BRO / BUY / 10.2% / 1.1% / 14.6 / 20.0 / 15.0% / 90.5 / 57.5 / 36.5%
Visa Inc. / V / BUY / 13.5% / 0.8% / 23.4 / 25.0 / 15.0% / 614.0 / 327.6 / 46.7%
Domino's Pizza, Inc. / DPZ / BUY / 9.4% / 2.3% / 19.1 / 25.0 / 14.82% / 532.7 / 337.8 / 36.6%
Topicus.com Inc. / TOI / BUY / 15.0% / 0.0% / 25.6 / 25.0 / 14.8% / 188.1 / 96.3 / 48.8%
SS&C Technologies Holdings, Inc. / SSNC / BUY / 10.5% / 1.6% / 10.3 / 13.0 / 14.7% / 110.8 / 69.3 / 37.4%
Intercontinental Exchange, Inc. / ICE / BUY / 12.0% / 1.3% / 19.5 / 21.9 / 14.5% / 259.3 / 154.7 / 40.3%
Evolution AB (publ) / EVO / BUY / 5.7% / 5.0% / 11.0 / 15.0 / 14.3% / 941.9 / 642.4 / 31.8%
Interparfums, Inc. / IPAR / BUY / 10.0% / 3.5% / 18.6 / 20.0 / 14.3% / 151.8 / 91.7 / 39.6%
Zoetis Inc. / ZTS / BUY / 7.0% / 1.8% / 16.2 / 25.0 / 14.2% / 156.6 / 114.2 / 27.1%
XPEL, Inc. / XPEL / BUY / 15.0% / 0.0% / 22.0 / 20.0 / 14.1% / 86.8 / 47.7 / 45.0%
Copart, Inc. / CPRT / BUY / 11.9% / 0.0% / 20.9 / 25.0 / 13.9% / 49.1 / 33.3 / 32.3%
Automatic Data Processing, Inc. / ADP / BUY / 6.03% / 3.20% / 17.3 / 25 / 13.68% / 287.3 / 214.1 / 25.47%
Esquire Financial Holdings, Inc. / ESQ / BUY / 13.50% / 0.80% / 16 / 15 / 13.68% / 175.7 / 106.9 / 39.20%
S&P Global Inc. / SPGI / BUY / 11.5% / 0.9% / 22.3 / 25.0 / 13.6% / 629.5 / 426.8 / 32.2%
Alphabet Inc. / GOOGL / BUY / 15.0% / 0.2% / 29.9 / 25.0 / 13.6% / 665.0 / 381.8 / 42.6%
Kinsale Capital Group, Inc. / KNSL / BUY / 11.0% / 0.3% / 17.2 / 20.0 / 12.9% / 416.8 / 311.8 / 25.2%
Alarm.com Holdings, Inc. / ALRM / BUY / 6.9% / 0.0% / 15.9 / 25.0 / 12.6% / 56.5 / 47.1 / 16.7%
MSCI Inc. / MSCI / BUY / 12.5% / 1.4% / 29.2 / 25.0 / 12.5% / 825.3 / 588.0 / 28.8%
Hamilton Lane Incorporated / HLNE / BUY / 3.4% / 2.3% / 15.1 / 25.0 / 12.3% / 107.2 / 92.6 / 13.6%
Deckers Outdoor Corporation / DECK / BUY / 7.0% / 0.0% / 14.0 / 21.3 / 12.2% / 118.5 / 101.3 / 14.6%
Pool Corporation / POOL / BUY / 8.12% / 2.30% / 21.2 / 25 / 12.21% / 256.2 / 208.1 / 18.78%
MercadoLibre, Inc. / MELI / BUY / 15.0% / 0.0% / 36.3 / 25.0 / 11.9% / 2548.7 / 1850.3 / 27.4%
Ameriprise Financial, Inc. / AMP / BUY / 9.8% / 1.4% / 11.0 / 11.7 / 11.8% / 563.2 / 466.0 / 17.3%
KKR & Co. Inc. / KKR / BUY / 9.8% / 0.7% / 16.2 / 17.9 / 11.5% / 119.9 / 103.7 / 13.6%
Moody's Corporation / MCO / BUY / 11.50% / 0.90% / 27.6 / 25 / 11.46% / 541.1 / 454.0 / 16.10%
Markel Group Inc. / MKL / BUY / 12.00% / 0.00% / 18.7 / 17.6 / 11.41% / 2094.3 / 1780.2 / 15.00%
Judges Scientific plc / JDG / BUY / 10.0% / 2.5% / 23.0 / 20.0 / 11.2% / 54.0 / 46.6 / 13.8%
Columbia Sportswear Company / COLM / BUY / 8.0% / 2.0% / 17.4 / 19.4 / 11.2% / 69.6 / 62.4 / 10.3%
Fair Isaac Corporation / FICO / BUY / 10.0% / 0.0% / 22.7 / 25.0 / 11.0% / 1121.8 / 1018.6 / 9.2%
RH / RH / BUY / 11.0% / 0.0% / 25.0 / 25.0 / 11.0% / 144.4 / 129.9 / 10.0%
3i Group plc / III / BUY / 11.0% / 3.1% / 25.7 / 30.0 / 15.8% / 50.8 / 25.7 / 49.5%
Sonova Holding AG / SOON / BUY / 5.4% / 2.60% / 19.6 / 25 / 10.76% / 182.0 / 171.2 / 5.92%
Computer Modelling Group Ltd. / CMG / BUY / 5.0% / 1.0% / 13.6 / 20.0 / 10.7% / 4.2 / 4.0 / 4.8%
Fairfax Financial Holdings Limited / FFH / BUY / 11.0% / 0.9% / 9.1 / 8.0 / 10.7% / 2352.2 / 2167.5 / 7.9%
Fortinet, Inc. / FTNT / BUY / 12.0% / 0.0% / 28.9 / 25.0 / 10.7% / 93.3 / 86.3 / 7.5%
Kelly Partners Group Holdings Limited / KPG / BUY / 12.00% / 0.00% / 30.6 / 25 / 10.17% / 4.4 / 4.3 / 2.08%
Sanlorenzo S.p.A. / SL / BUY / 3.8% / 3.2% / 10.9 / 14.2 / 10.0% / 33.3 / 33.2 / 0.2%]

14 out of the 18 companies that we own are a 'Buy' right now:

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)

Judges Scientific ($JDG)

Constellation Software ($CSU)

Zoetis ($ZTS)

I truly believe some great opportunities can be found in the list above.

Here are the most undervalued companies based on the Forward PE:

[Image — most undervalued on Forward PE. Source: Compounding Quality]

We saw some positive developments with Novo Nordisk:

Net profit, Revenue, and Operating profit all came in ahead of expectations, and management raised 2026 guidance

The Wegovy pill was the most successful drug launch ever

Total prescriptions are more than 2 million

Wegovy brand now holds 65% of all new prescriptions in the U.S.

Strategic partnership with OpenAI: enhancing drug discovery

Currently, the stock is trading at it's lowest valuation levels:

[Image — Novo Nordisk valuation. Source: Fiscal.ai]

As a reminder:

There are daily updates about Novo Nordisk in the Community

You read the full investment case here

2. Earnings Growth Model

Here are the most undervalued companies based on our Earnings Growth Model:

[Image — most undervalued on the Earnings Growth Model. Source: Compounding Quality]

One company that definitely stands out? Adobe ($ADBE).

The company is trading at its cheapest valuation level ever:

[Image — Adobe valuation history. Source: Fiscal.ai]

Adobe has steadily grown its revenue at a 15% CAGR over the past decade.

If you want a steady, reliable company that can grow revenue and compound shareholder value for years to come, Adobe might be the one.

This is under the assumption you don't believe Artificial Intelligence will disrupt their business model.

For me personally, Adobe is in the 'too hard' pile.

[Image — Adobe revenue history. Source: Fiscal.ai]

3. Reverse DCF

Here's a list of the most undervalued companies based on Our Reverse DCF:

[Image — most undervalued on Reverse DCF. Source: Compounding Quality]

The Big Picture

Today, 68 companies are undervalued on each valuation method.

This number has never been higher.

[Image — companies undervalued on all three methods. Source: Compounding Quality]

Our Portfolio

Here's what the valuation for our Portfolio looks like:

[Table image — the 18 portfolio holdings with conviction and rating. Columns: Company / Conviction (quality) / Rating (valuation) / EPS Growth / Dividend Yield / FWD PE / Fair exit PE / Expected Return / Fair value / Stock price / Over-Undervaluation.
Medpace Holdings, Inc. / Very Strong / BUY / 12.0% / 0.0% / 29.7 / 25 / 10.4% / 439.4 / 417.7 / 5.0%
Evolution AB (publ) / Medium / BUY / 5.7% / 5.0% / 11 / 15 / 14.3% / 941.9 / 642.4 / 31.8%
Kelly Partners Group Holdings Limited / Strong (+) / STRONG BUY / 12.0% / 0.0% / 30.6 / 25 / 10.2% / 4.4 / 4.3 / 2.1%
Brown & Brown, Inc. / Strong (+) / STRONG BUY / 10.2% / 1.1% / 14.6 / 20 / 15.0% / 90.5 / 57.5 / 36.5%
LVMH Moet Hennessy - Louis Vuitton, Societe Europeenne / Strong / HOLD / 9.6% / 2.9% / 19.9 / 24.9 / 15.0% / 753.1 / 451.4 / 40.1%
Games Workshop Group PLC / Very Strong / HOLD / 7.0% / 2.5% / 33.1 / 23 / 6.4% / 124.5 / 189.5 / -51.1%
Dino Polska S.A. / Strong / BUY / 15.0% / 0.0% / 17.7 / 20 / 16.3% / 72.5 / 32.1 / 55.8%
Kinsale Capital Group, Inc. / Very Strong / STRONG BUY / 11.0% / 0.3% / 17.2 / 20 / 12.9% / 416.8 / 311.8 / 25.2%
Interparfums, Inc. / Strong / BUY / 10.0% / 3.5% / 18.6 / 20 / 14.3% / 151.8 / 91.74 / 39.6%
Ameriprise Financial, Inc. / Very Strong / BUY / 9.8% / 1.4% / 11 / 11.7 / 11.8% / 563.2 / 466 / 17.3%
Visa Inc. / Very Strong / BUY / 13.5% / 0.8% / 23.4 / 25 / 15.0% / 614 / 327.6 / 46.6%
Topicus.com Inc. / Very Strong / STRONG BUY / 15.0% / 0.0% / 25.6 / 25 / 14.8% / 188.1 / 96.3 / 48.8%
Judges Scientific plc / Medium / HOLD / 10.0% / 2.5% / 23 / 20 / 11.2% / 54 / 46.6 / 13.8%
HgCapital Trust / Strong (+) / BUY / 12.0% / 1.1% / 3.75 (stock price) / 5.6 (NAV per share) / 16.4% / 5.6 (NAV per share) / 3.7 / 34.2%
Novo Nordisk A/S / Medium / STRONG BUY / 8.6% / 4.3% / 12.3 / 20 / 19.2% / 636.7 / 278 / 56.3%
Constellation Software Inc. / Very Strong / STRONG BUY / 15.0% / 0.2% / 15.8 / 20 / 17.9% / 6434.6 / 2440 / 62.1%
Brookfield Corporation / Very Strong / BUY / 12.0% / 0.6% / 46 / 68 / 17.4% / 122.8 / 61.47 / 49.9%
Zoetis Inc. / Strong (+) / STRONG BUY / 7.0% / 1.8% / 16.2 / 25 / 14.2% / 156.6 / 114.2 / 27.1%]

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. Here's what you should remember:

Finding the AI winner is very difficult

It makes more sense to focus on companies that provides infrastructure and tools that every AI company needs

49 stocks in Our Buy-Hold-Sell List are on 'Buy' right now

2 new Stocks were added:

3i Group ($III)

Alphabet ($GOOGL)

2 Stocks went from Hold to Buy:

Fairfax Financial Holdings ($FFH)

Fair Isaac Corporation ($FICO)

4 Stocks went from Sell to Hold:

Nathan's Famous ($NATH)

Cintas ($CTAS)

Hermes ($RMS)

HEICO ($HEI)

7 Companies are a 'Strong Buy' in Our Portfolio today:

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

And always remember: today is an amazing day to add great companies to your portfolio.

Everything In Life Compounds
Team Compounding Quality

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Interactive Brokers: Portfolio data and executing all transactions

Fiscal.ai: Financial data

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