Quality Equities @qualityequities

Most companies fail to create true wealth because their returns on investment barely cover their borrowing and operational costs. When these businesses grow, they are actually consuming capital rather than generating value. Long-term investing success relies entirely on filtering out these traps and identifying the rare exceptions known as quality compounders. These unique companies earn exceptionally high returns (often 20% to 40%), and can continuously reinvest their profits at those same high rates for decades. Because a cheap stock price cannot fix a business that destroys value, serious investors must prioritize finding these high-return compounders before evaluating management or valuation, ignoring everything else. What is a quality compounder? How do you identify a business that compounds for decades? Free deep-dive available tomorrow morning: open.substack.com/pub/qualityequ…

Bullish for $META Meta Platforms.

Instagram @instagram

a day ago

Introducing Meta Glasses by @KylieJenner. A new way to see and share your world.

425 171 2K 4.7M 222

A low multiple is only a bargain if the earnings power behind it remains intact. If $ACN Accenture’s traditional business model is being structurally disintermediated by AI, that "cheap" multiple is entirely justified...and the compounding story may be over, or highly blunted.

Quality Equities @qualityequities

2 days ago

$ACN Accenture is the largest implementer of enterprise technology in the world, and the technology now reshaping every enterprise is artificial intelligence. The paradox sits at the center of the company: the same force driving record AI-transformation demand today is the force

1 1 6 4K 2

$ACN After a 59% collapse, is artificial intelligence still the structural threat the market now fears — or has the threat already been paid for? Read the bull vs. bear now: qualityequities.substack.com/p/accenture-se…

Quality Equities @qualityequities

2 days ago

$ACN Accenture is the largest implementer of enterprise technology in the world, and the technology now reshaping every enterprise is artificial intelligence. The paradox sits at the center of the company: the same force driving record AI-transformation demand today is the force

1 1 6 4K 2

The volatility continues. $NOW ServiceNow has roughly halved from its high near $211. The market thinks AI will gut the business. ServiceNow has historically charged per user ("per seat"), so if AI agents replace workers, the fear is fewer seats and a shrinking company. That fear doesn't match what the company is showing. The numbers that would crack first if the bear case were right — customers leaving, deals shrinking — are doing the opposite: - 97% of customers renew — and have for six straight quarters. Almost nobody leaves. - Deals are getting bigger, not smaller. About half of new contract value is now priced on usage or outcomes, not seats. - The AI product is selling fast. Now Assist is at ~$750M and management raised its 2026 target to $1.5B (from $1B). - Cash flow is strong: ~$4.6B in free cash flow last year (+34%), net cash, and a $5B buyback. So the price fell, but the business kept compounding (~20% growth). That's the whole point: the stock got cheaper while the company got better. What would prove this wrong: if renewals start slipping or new deals visibly shrink into seat-replacement size. Until that shows up in the data, the market is selling the story, not the business.

Quality Equities @qualityequities

3 weeks ago

$NOW ServiceNow shares have staged a powerful turnaround, surging nearly 40% in May alone. This explosive move represents a dramatic reversal from earlier in the year when the stock tumbled over 40% due to panic selling across the software sector. Looking at this through the

1 1 12 11K 4

$ACN Accenture is the largest implementer of enterprise technology in the world, and the technology now reshaping every enterprise is artificial intelligence. The paradox sits at the center of the company: the same force driving record AI-transformation demand today is the force that could, over time, compress the labor-based model that produces Accenture's revenue. Accenture bills for human hours at a margin over cost. Generative AI exists to reduce the human hours required to reach a given outcome. The company is, quite literally, paid to install the tool capable of shrinking its own addressable pool of billable work. This made for a very interesting and rather insightful bull vs. bear report. Available tomorrow morning at 8:30am ET. Subscribe here: open.substack.com/pub/qualityequ…

Quality Equities @qualityequities

4 days ago

For years, $ACN Accenture was a gold standard in the consulting world, supported by strong fundamentals and high ROIC. But its recent Q3 2026 earnings highlight a deeper fundamental downfall that quality investors can no longer ignore. Does AI eat the consulting model that built

0 0 7 4K 2

For years, $ACN Accenture was a gold standard in the consulting world, supported by strong fundamentals and high ROIC. But its recent Q3 2026 earnings highlight a deeper fundamental downfall that quality investors can no longer ignore. Does AI eat the consulting model that built Accenture? Deep dive coming this week.

$KLAC Consensus treats KLA as a high-quality but fundamentally cyclical wafer-fabrication-equipment vendor — a beneficiary of the AI capital spending wave whose returns will compress when the semiconductor cycle turns. That framing is half-right and dangerously incomplete. KLA is not one competitor inside a cyclical equipment market; it is a structural near-monopoly in semiconductor process control, the quality assurance layer of chip manufacturing, with roughly 56% of the overall process-control market and more than 85% of optical wafer inspection. The more accurate view rests on three reinforcing features the cyclical model collapses into a single number: a pricing power monopoly, an intensity tailwind in which process control content per wafer rises as chips grow more complex, and a recurring services base whose lifetime revenue per installed tool now exceeds the tool’s original selling price. A monopoly with rising content per unit and a software-like annuity underneath is not a cyclical equipment vendor. Read the full deep-dive here, including valuation and buy verdict: open.substack.com/pub/qualityequ…

Quality Equities @qualityequities

a week ago

$KLAC KLA is an elite, asset-light royalty business on human technological progress. You are not betting on which specific AI application or smartphone brand wins; you are betting that as long as humanity demands smaller, faster, and more powerful microchips, manufacturers will

3 2 22 5K 8

$KLAC KLA is an elite, asset-light royalty business on human technological progress. You are not betting on which specific AI application or smartphone brand wins; you are betting that as long as humanity demands smaller, faster, and more powerful microchips, manufacturers will have to pay the KLA toll to ensure those chips actually work. Deep-dive coming tomorrow morning.

Quality Equities @qualityequities

4 months ago

Alongside $ASML ASML, $KLAC KLA operates as another toll booth of the semiconductor industry. They dominate the niche of process control, providing the essential inspection tools that ensure microchips actually work. As chips become more complex due to the AI revolution, the

2 3 28 6K 3

"Wall Street analysts’ projection for future free cash flow at the four hyperscalers we started with. It is expected to bottom out in 2027 — and then grow at a rate much faster than anything in the companies’ history." $AMZN $MSFT $META $GOOG $GOOGL

Financial Times @FT

2 weeks ago

AI is revolutionising the stock market ft.trib.al/N5fExVY

9 12 50 24K 10

The decision to exit a position is the most consequential and least-discussed decision a long-term investor makes. The case for owning quality compounders has been made elsewhere. This piece addresses the harder question: when to stop owning them. Read for free today: open.substack.com/pub/qualityequ…

Quality Equities @qualityequities

2 weeks ago

What makes you sell a stock?

2 0 2 2K 0

What makes you sell a stock?

$TDG TransDigm deep-dive out now: open.substack.com/pub/qualityequ…

Quality Equities @qualityequities

2 weeks ago

$TDG TransDigm sells the small, boring, mission-critical parts that keep aircraft flying...and owns the economics of those parts like almost no other industrial business. The parts are cheap relative to the airplane but indispensable to it. ~90% of sales are proprietary, often

0 3 30 5K 14

When the fundamentals accelerate but the market panics, quality investors pay attention. Look at $FICO FICO: Revenue growth has surged to a roaring 23%. Meanwhile, its P/E multiple compressed from a peak of ~120x down to ~36x—well below its 5-year median of ~53x. A strong moat with organic growth, wrapped in a rare valuation de-rating. Growth is accelerating, yet the price tag just got a lot cheaper.

Aria Radnia 🇮🇷 @ariaradnia

2 weeks ago

$FICO is DISGUSTINGLY undervalued... Reasoning:

16 3 121 34K 25

BlackRock claims mega forces are reshaping investing. Here's a summary: Traditional investment methods are losing their edge. Long-term structural shifts—like the AI boom, changing demographics, global political tensions, and the energy transition—are reshaping the financial landscape. To navigate this, investors need to review their major portfolio decisions more frequently and always have a backup plan ready. When it comes to AI, the smartest move isn't guessing which software company will win the race. Instead, focus on the "picks and shovels" that power the expansion. Companies providing semiconductors, data centers, and power systems are poised to win regardless of which tech giant comes out on top. Geography matters less than business models. Instead of focusing on where a company's stock is listed, look deeply at what the company actually does and where its revenue comes from. High-quality businesses with strong earnings growth, particularly in the U.S. and in emerging markets that manufacture critical AI components, remain highly attractive. On the bond side, avoid long-term government debt like U.S. Treasurys and Japanese government bonds. Rising inflation risks and heavy government borrowing make long-term government bonds a poor risk-reward trade. If you want income, look toward higher-yielding alternatives like U.S. agency mortgage-backed securities or emerging-market debt tied to strong commodities. Finally, long-term private markets offer compelling opportunities. Infrastructure equity and private credit are seeing massive demand driven by the AI buildout and global supply chain shifts. However, selectivity is critical here, as the gap between the best and worst-performing private investments is widening.

Bernstein believes that quantum computing is the next major frontier in technology, acting as a specialized accelerator alongside traditional computer chips. Instead of one company dominating the entire industry, the market will likely have multiple winners because different quantum technologies excel at different tasks. While tech giants like $GOOG Google and $MSFT Microsoft are investing heavily, Bernstein highlights two smaller, specialized stocks with great risk-reward potential: $RGTI Rigetti Computing and $INFQ Infleqtion. Because current stock prices reflect very low expectations for their future market share, any major success could lead to massive upside for investors. Key Stock Highlights: - Rigetti Computing: This company focuses on superconducting quantum technology. It is financially stable with roughly $590 million in cash and is making steady progress on its advanced chips. Wall Street analysts see potential for the stock to climb significantly from its recent price of around $21. - Infleqtion: Operating in neutral-atom technology, Infleqtion is already generating revenue by combining quantum sensing with quantum computing. Analysts are highly optimistic about its future, especially due to a key partnership with Nvidia to integrate quantum tech with AI supercomputers. Both stocks have shown strong momentum recently, making them attractive, high-upside options for investors looking to gain early exposure to the quantum computing sector. In my view, this setup is highly speculative, and a disciplined quality investor wouldn't touch either of these stocks right now. Quality investing is focused on finding companies with deeply entrenched moats (think high switching costs, strong network effects, or irreplaceable intangible assets. As the Bernstein note explicitly states, it is "far too early...to declare an ultimate winner" and "different modalities bring distinct strengths." This means no one has a moat yet. The technology is in flux, and a competitor could introduce a brand-new architecture tomorrow that renders Rigetti’s or Infleqtion’s current hardware completely obsolete. Quantum computing is incredibly capital-intensive. These companies must pour millions into R&D and specialized manufacturing just to build a functioning chip. While the note mentions Rigetti has $590 million in cash, that cash isn't profit from operations...it's a runway they are actively burning through. Quality investors want companies that generate cash, not companies that need a massive cash hoard just to survive the next few years. Think for yourself. For me, it's a pass for now.

$BN Great watch for Brookfield investors.

Brookfield @Brookfield

2 weeks ago

To enable the digitalized economies of the future, we are building the key infrastructure today. #ICYMI, BAM CEO Connor Teskey sat down with @CNBC Squawk Box Asia to discuss the investment needed in physical assets that support AI use at scale. Watch the full interview:

0 1 11 4K 2

ASML Holding N.V. (NASDAQ: $ASML) Position Case Study | Status: Core Holding Total Return to Date: 127.8% I bought a monopoly at a discount in a year when the stock declined while the broader market rallied. My view was that the near-term weakness in the share price had nothing to do with the fundamentals or the durability of the franchise.

End of May 2026 portfolio update. My portfolio contains exceptional, world-class businesses. I avoid speculative junk, and instead focus on dominant leaders with massive competitive moats, high returns on capital, and long runways for growth. At the core, I own unbeatable monopolies and toll-booth businesses. Visa and Mastercard act as toll booths on global spending, while S&P Global and FICO dominate the essential data and credit-rating markets. These companies require very little cash to run, giving them immense pricing power and elite profitability. I'm also heavily backed by the ultimate tech and AI infrastructure. ASML and KLA are literal gatekeepers for semiconductor manufacturing. Advanced chips can't be made without them. Meanwhile, Microsoft, Alphabet, Meta, and Amazon control the digital real estate and cloud networks that power the modern global economy. Nvidia is the undisputed king of AI computing infrastructure. Structural tailwinds makes these companies incredible long-term compounders. Brookfield is a masterclass in capital allocation. They invest in hard, essential assets (infrastructure, renewable energy, real estate), and have a long history of compounding value for shareholders. This past month, I continued to add to Meta, Mastercard, S&P Global, and Brookfield. I continue to remain very bullish on the portfolio. If you haven't already, please subscribe to my Substack for deep dive equity research into my holdings (as well as other compounding machines), and highly relevant thematic trends shaping today's markets. Link here and in bio: qualityequities.substack.com $GOOG $META $NVDA $AMZN $V $SPGI $UBER $MA $MSFT $FICO $ASML $KLAC $BN

Quality Equities @qualityequities

2 months ago

Minor changes to the portfolio in April 2026. Added to $META Meta, $MA Mastercard, $AMZN Amazon, $BN Brookfield, and $FICO FICO. Only buys. The portfolio is built around some of the world’s strongest, highest‑moat platforms, with a heavy tilt toward scalable, asset‑light,

16 8 236 35K 96