This refresh
Data-driven refresh August 17, 2026. The Top Picks are the Bull Rankings quality-growth screen — strong, growing businesses with durable returns at a fair price (PEG / EV-EBIT vs sector, ROIC, free cash flow). Scanned every US-listed common stock on NYSE, NASDAQ, NYSE American, and NYSE Arca (5,243 tickers); 1,712 scored on the quality-growth model (financials route to a separate card). Fundamentals from Yahoo Finance quoteSummary reconciled with as-reported SEC EDGAR filings; narrative authored by Groq (with Gemini and data-driven fallbacks).
Top Picks — quality compounders at a fair price
1. DLO — DLocal Limited · score 90.6
Software - Infrastructure · price $13.91 · 1Y $18.35 · 5Y $26.87 · 10Y $39.85
FCF $413m C · Rev +46.6% A · D/E 0.12 B+ · P/E 20.5x A- · PEG 0.65 A-
Why now. DLocal’s pay‑in platform for global merchants is exploding, delivering 46.6% YoY revenue growth while generating $413 m of free cash flow and a stellar 34.6% ROE. The Bull Rankings model rates its Growth pillar at 98, making the compounding power of cross‑border payments the single biggest catalyst, and the consensus 1‑yr target of $18.35 already reflects near‑term upside. The thesis rests on the persistence of merchant adoption across e‑commerce, streaming and ride‑hailing, which should keep the growth engine humming.
Moat. The moat lives in DLocal’s integrated payment stack that aggregates hundreds of local cards, bank transfers and alternative methods, locking in merchants who need a single gateway for cross‑border and local‑to‑local transactions. This network creates high switching costs and enables pricing power, which translates into the observed 34.6% ROE—far above sector averages—by extracting margin on every transaction.
Risk. The biggest headwind is shareholder dilution, flagged by our model as a cautionary signal, which could erode per‑share earnings even as the business scales. Moreover, the reverse‑DCF shows the current price implies a negative -9% annual free‑cash‑flow growth for the next decade, starkly at odds with the 46.6% revenue growth and suggesting the market may be over‑optimistic. A slowdown in merchant spend or a rise in competition would trigger the dilution‑driven earnings drag and validate the bear case.
Horizon. 1-3 yr $18.35 (analyst consensus (n=10)) — fundamentals + valuation re-rating. 5 yr $26.87 at ~14% CAGR — compounding case rests on the competitive position widening. 10 yr $39.85 if current growth sustains into durable earnings power.
2. ADBE — Adobe Inc. · score 89.6
Software - Application · price $254.04 · 1Y $269.72 · 5Y $394.90 · 10Y $585.81
FCF $10.3b A- · Rev +11.5% B · D/E 0.61 C+ · P/E 14.5x A- · PEG 0.64 A-
Why now. Adobe’s Digital Experience platform is locking in enterprise customers who need end‑to‑end analytics, commerce and personalization, driving a 11.5% YoY revenue lift and a 28.7% profit margin—numbers that validate our model’s 89.6/100 quality‑growth score, especially the 92 on Quality. The company’s 62.8% ROE, powered by pricing power in the high‑margin Creative Cloud suite, shows it can sustain the 11.5% revenue growth while returning cash to shareholders through aggressive buybacks. The thesis rests on Adobe’s ability to compound that revenue growth through its tightly integrated experience stack, which keeps churn low and upsell high.
Moat. Adobe’s moat is the seamless integration of its Creative Cloud and Digital Experience products, which creates a network effect for marketers and content creators who rely on a single ecosystem for analytics, commerce and creative workflows. This integration locks in enterprise customers, making switching costly and giving Adobe a pricing advantage that drives its 62.8% ROE.
Risk. The bear case hinges on Adobe’s elevated 14.5× P/E and a debt‑to‑equity of 0.61, which could pressure margins if the 11.5% revenue growth slows or if competitors like Microsoft’s Power Platform erode its Digital Experience share. A sharp decline in the 11.5% revenue growth would also invalidate the 12% CAGR implied by the reverse‑DCF, breaking the bull thesis.
Horizon. 1-3 yr $269.72 (analyst consensus (n=34)) — fundamentals + valuation re-rating. 5 yr $394.90 at ~9% CAGR — compounding case rests on the competitive position widening. 10 yr $585.81 if current growth sustains into durable earnings power.
3. HRMY — Harmony Biosciences Holdings, Inc. · score 88.3
Biotechnology · price $38.14 · 1Y $46.10 · 5Y $67.50 · 10Y $100.12
FCF $355m C · Rev +24.3% A- · D/E 0.16 B+ · P/E 12.3x A · PEG 0.44 A
Why now. Harmony’s commercial‑stage narcolepsy drug WAKIX anchors a high‑margin franchise that is already delivering 18.9% profit margin and 24.3% revenue growth YoY while the stock trades at a modest PE of 12.3x, leaving ample upside as the market re‑prices the pipeline’s rare‑disease potential. The combination of a cash‑generating product and a $355 m free‑cash‑flow runway fuels compounding that can sustain double‑digit earnings growth for years. The thesis hinges on WAKIX expanding its market share and the Phase 3 PWS read‑out unlocking a second high‑margin indication.
Moat. WAKIX’s novel histamine‑3 antagonism gives Harmony a differentiated, FDA‑approved therapy for excessive daytime sleepiness, creating a pricing premium and low‑switching cost for neurologists and sleep‑disorder clinics. This IP shield, coupled with an 18.1% ROE driven by pricing power in a niche rare‑neurology market, limits competitive entry and secures cash flows that fund the pipeline.
Risk. The company’s revenue stream is heavily concentrated on WAKIX, so any adverse safety signal or reimbursement squeeze could stall growth; the reverse‑DCF shows the market is already assuming a –18% annual free‑cash‑flow decline, which would be justified if pipeline failures materialize. A slip in the Phase 3 PWS trial or a slowdown in narcolepsy sales would push the PE higher and erode the current valuation cushion. Confirmation of a negative trial outcome would instantly invalidate the growth story.
Horizon. 1-3 yr $46.10 (analyst consensus (n=10)) — fundamentals + valuation re-rating. 5 yr $67.50 at ~12% CAGR — compounding case rests on the competitive position widening. 10 yr $100.12 if current growth sustains into durable earnings power.
4. NBIX — Neurocrine Biosciences, Inc. · score 87.8
Drug Manufacturers - Specialty & Generic · price $154.49 · 1Y $211.57 · 5Y $309.76 · 10Y $459.51
FCF $870m C+ · Rev +34.4% A · D/E 0.12 B+ · P/E 22.6x B+ · PEG 0.45 A
Why now. Neurocrine’s Orilissa and Oriahnn are driving a 34.4% YoY revenue surge, while its free‑cash‑flow of $870 m fuels a 20.9% profit margin and a 19.1% ROE—proof that the company is a high‑growth, high‑margin specialty drug player. Our model’s growth pillar scores 96, underscoring the sustainable expansion in the endometriosis and uterine fibroid markets, and the current price already reflects an 8% free‑cash‑flow growth assumption, leaving room for upside if the 34% revenue pace continues. The thesis rests on the fact that Neurocrine’s product pipeline and market leadership in these niche indications will keep the revenue engine accelerating for the next decade.
Moat. Neurocrine’s Orilissa and Oriahnn command a near‑monopoly in the endometriosis and uterine fibroid segments, backed by exclusive FDA approvals and a robust reimbursement landscape that locks in high pricing power. The company’s 19.1% ROE is a direct result of capturing premium margins through these category‑specific drugs, and the low debt‑to‑equity of 0.12 keeps capital costs minimal, allowing reinvestment into R&D without eroding shareholder value.
Risk. The bear case hinges on the concentration risk of relying on a handful of blockbuster drugs; a regulatory setback or a competitive entrant in the endometriosis space could erode margins, as evidenced by the 22.6 P/E that already prices in significant upside. A dip in the 34.4% revenue growth or a margin squeeze would immediately trigger a re‑pricing of the 8% free‑cash‑flow growth assumption, breaking the bull thesis.
Horizon. 1-3 yr $211.57 (analyst consensus (n=27)) — fundamentals + valuation re-rating. 5 yr $309.76 at ~15% CAGR — compounding case rests on the competitive position widening. 10 yr $459.51 if current growth sustains into durable earnings power.
5. PGY — Pagaya Technologies Ltd. · score 86.2
Software - Infrastructure · price $20.93 · 1Y $28.80 · 5Y $42.17 · 10Y $62.55
FCF $252m C · Rev +25.6% A- · D/E 1.34 C · P/E 14.8x A- · PEG 0.04 A
Why now. Pagaya’s Decline Monetization engine is unlocking a hidden pool of loan revenue, driving 25.6% YoY revenue growth while delivering $252 m of free‑cash‑flow and a rock‑bottom PE of 14.8× that leaves ample headroom for a multiple expansion. The combination of AI‑powered loan routing and a PEG of 0.04 signals that earnings are compounding faster than the market expects, making the next 12‑months a pure upside play.
Moat. The moat lives in Pagaya’s proprietary AI platform that powers Decline Monetization, Dual Look and First Look, creating a sticky network where lenders rely on Pagaya to monetize rejected applications—an operation that is hard to replicate without deep data and model expertise. This lock‑in fuels a ROE of 19.5%, reflecting pricing power from being the go‑to partner for sophisticated investors seeking higher‑yield loan assets.
Risk. The stock’s beta of 5.37 makes it wildly sensitive to market swings, and a debt‑to‑equity of 1.34 adds leverage risk if credit cycles turn. Moreover, the Bull Rankings model’s reverse DCF implies a -15% annual free‑cash‑flow trajectory, a stark contrast to the 25.6% revenue growth—if cash generation stalls, the current valuation becomes untenable. A sustained market pullback that triggers the high beta would confirm the bear case and crush the upside thesis.
Horizon. 1-3 yr $28.80 (analyst consensus (n=10)) — fundamentals + valuation re-rating. 5 yr $42.17 at ~15% CAGR — compounding case rests on the competitive position widening. 10 yr $62.55 if current growth sustains into durable earnings power.
6. INTU — Intuit Inc. · score 86.1
Software - Application · price $335.60 · 1Y $451.32 · 5Y $660.78 · 10Y $980.22
FCF $7.8b B+ · Rev +15.1% B+ · D/E 0.33 B · P/E 20.5x A- · PEG 0.90 B+
Why now. Intuit’s QuickBooks platform, now bolstered by Mailchimp’s marketing automation, is the engine that will keep revenue compounding at a rapid clip – the business is already delivering 15.1% YoY revenue growth, a rock‑solid 21.9% profit margin, and $7.8 B of free cash flow on a $91.8 B market cap. Those fundamentals, combined with a PEG of 0.9, mean the company is growing faster than its valuation suggests, and the Bull Rankings model flags Growth as its strongest pillar (86.1 overall). The thesis rests on the relentless expansion of the SMB ecosystem that fuels both recurring subscription and higher‑margin merchant services.
Moat. The moat lives in the integrated QuickBooks‑Mailchimp stack that locks small‑ and mid‑market firms into a single financial‑management and marketing workflow, creating high switching costs and a data moat that fuels upsell. This stickiness translates into an ROE of 22.2%, driven by pricing power in payroll, payments and financing services that competitors can’t replicate quickly.
Risk. The market is pricing Intuit for growth that the reverse‑DCF shows is unrealistic – the current price implies a negative ‑3%/yr free‑cash‑flow growth over the next decade, yet revenue is only at 15.1% growth and the P/E sits at a lofty 20.5. If the company can’t accelerate cash generation or if the dividend raise drains cash, the valuation gap will widen and the bull case collapses.
Horizon. 1-3 yr $451.32 (analyst consensus (n=33)) — fundamentals + valuation re-rating. 5 yr $660.78 at ~15% CAGR — compounding case rests on the competitive position widening. 10 yr $980.22 if current growth sustains into durable earnings power.
7. NVDA — NVIDIA Corporation · score 86.1
Semiconductors · price $225.01 · 1Y $302.83 · 5Y $443.37 · 10Y $657.71
FCF $119.1b A · Rev +70.7% A · D/E 0.07 B+ · P/E 34.5x B · PEG 0.62 A-
Why now. The bull case hinges on NVIDIA's Compute & Networking data‑center AI platform, which is fueling an explosive 70.7% YoY revenue growth and a staggering 63% profit margin, delivering $119.1B of free cash flow that powers a 51%/yr reverse‑DCF growth assumption. With a market cap of $5.4T and a PEG of 0.62, the company is compounding cash at a rate few peers can match, and the thesis rests on the continuation of AI‑driven demand in data centers.
Moat. NVIDIA's moat stems from its industry‑leading GPU architecture that powers the Compute & Networking segment, locking in hyperscale cloud providers and enterprise AI customers who face massive switching costs and rely on NVIDIA’s proprietary software stack. The 81.7% ROE reflects pricing power derived from being the de‑facto standard for accelerated computing, a position competitors cannot replicate quickly due to the deep IP and ecosystem lock‑in.
Risk. The bear case centers on the lofty valuation: a P/E of 34.5 is high for a growth stock, and the implied 51% annual free‑cash‑flow growth over ten years far outpaces the already blistering 70.7% revenue surge, leaving little margin for error if AI spending cools or competitors close the performance gap. A sustained slowdown in data‑center demand would push the P/E down and could trigger a sell‑off, confirming the downside.
Horizon. 1-3 yr $302.83 (analyst consensus (n=58)) — fundamentals + valuation re-rating. 5 yr $443.37 at ~15% CAGR — compounding case rests on the competitive position widening. 10 yr $657.71 if current growth sustains into durable earnings power.
8. GDDY — GoDaddy Inc. · score 85.6
Software - Infrastructure · price $92.37 · 1Y $104.80 · 5Y $153.44 · 10Y $227.61
FCF $1.7b C+ · Rev +7.4% B · D/E n/a · P/E 13.7x A · PEG 0.68 A-
Why now. GoDaddy’s Websites + Marketing platform is scaling at a 7.4% YoY revenue growth while delivering a solid 17.8% profit margin, and the Bull Rankings model scores a 95 on Quality—showing that the company’s recurring subscription base and high customer stickiness are already generating cash. The company’s $1.7 B free‑cash‑flow and a current P/E of 13.7 indicate that the market is pricing in modest growth, yet the 85.6 overall score and a strong buy‑back signal suggest that the stock is still under‑appreciated for its high‑margin, low‑cost platform. The thesis rests on the fact that the Websites + Marketing segment can continue to compound its revenue as it expands into new verticals while keeping margins intact.
Moat. The core moat is the managed WordPress and mobile‑optimized e‑commerce stack, which locks in SMBs that rely on a single vendor for site building, hosting, and marketing tools. Switching costs are high because migrating a WordPress site to another platform requires technical expertise and time, and the integrated Studio and SEO services create a bundled ecosystem that competitors find hard to replicate quickly.
Risk. The bear case hinges on the fact that GoDaddy’s P/E of 13.7 is already above the sector median, and the company’s 7.4% revenue growth is modest compared to the 0.68 PEG ratio, implying that future growth may not keep pace with the current valuation. If the Websites + Marketing segment faces intensified competition from cloud‑native builders like Wix or Squarespace, the margin compression could erode the 17.8% profit margin, breaking the bull thesis.
Horizon. 1-3 yr $104.80 (analyst consensus (n=15)) — fundamentals + valuation re-rating. 5 yr $153.44 at ~11% CAGR — compounding case rests on the competitive position widening. 10 yr $227.61 if current growth sustains into durable earnings power.
9. DOCS — Doximity, Inc. · score 84.3
Health Information Services · price $24.52 · 1Y $29.11 · 5Y $42.62 · 10Y $63.23
FCF $306m C · Rev +11.2% B · D/E 0.01 A- · P/E 29.2x B · PEG 0.59 A-
Why now. Doximity’s AI‑driven workflow tool Ask is turning its massive physician network into a sticky, high‑margin revenue engine, and that’s why the stock should keep climbing. The platform already delivers a 25.5% profit margin, a 18.2% ROE, and 11.2% YoY revenue growth while generating $306 m of free cash flow — a rare combination in health‑info services. Those fundamentals let the company compound earnings through deeper clinical integration, and the whole thesis rests on Ask expanding its usage across U.S. doctors.
Moat. The moat lives in Doximity’s exclusive access to U.S. physicians who rely on its newsfeed, peer updates, and the HIPAA‑compliant Ask assistant for real‑time evidence‑based decisions. Switching costs are high because clinicians embed Ask into daily workflows, and the network effect means every new user makes the platform more valuable to advertisers and pharma sponsors, driving the strong ROE.
Risk. The stock trades at a lofty PE of 29.2 despite only 11.2% revenue growth, implying the market is already pricing in the 6% free‑cash‑flow growth the Bull Rankings model reverse‑DCF assumes. If Ask fails to scale or pharma spend tightens, the valuation cushion evaporates and the beta of 1.21 could amplify a pull‑back. A sustained slowdown in margin or a dip below the 52‑week low would confirm the bear case.
Horizon. 1-3 yr $29.11 (analyst consensus (n=18)) — fundamentals + valuation re-rating. 5 yr $42.62 at ~12% CAGR — compounding case rests on the competitive position widening. 10 yr $63.23 if current growth sustains into durable earnings power.
10. APP — AppLovin Corporation · score 83.7
Advertising Agencies · price $311.98 · 1Y $548.52 · 5Y $803.08 · 10Y $1,191
FCF $4.5b B · Rev +60.6% A · D/E 1.11 C+ · P/E 24.0x C+ · PEG 0.87 B+
Why now. AppLovin’s MAX in‑app bidding platform is unlocking a 60.6% YoY revenue surge, fueling a free‑cash‑flow engine that generated $4.5B this year and delivered a staggering 64.6% profit margin. Our Bull Rankings model rates the stock 83.7/100 on Quality‑Growth, with Growth as the strongest pillar, confirming that the compounding engine is real and durable. The thesis hinges on the ability of MAX and Adjust to keep expanding ad spend while the market already prices in a 14% FCF growth rate, leaving upside if the platform’s network effects accelerate revenue faster than the reverse‑DCF assumption.
Moat. MAX runs a real‑time competitive auction that locks publishers into a high‑margin, data‑rich ecosystem, while Adjust’s measurement suite makes developers reluctant to switch because of entrenched analytics and attribution data. This combination creates switching costs and a network effect that competitors can’t replicate quickly, preserving the high margins that underpin the business.
Risk. The stock trades at a lofty of 24 and a beta of 2.53, meaning any slowdown in ad spend or a miss on the 14% FCF growth assumption would trigger a sharp sell‑off; the debt‑to‑equity of 1.11 adds leverage risk if cash flows falter. A bear’s trigger is a deceleration of revenue growth below 40% YoY, which would validate the over‑optimistic valuation and drive the price back toward the 52‑week low.
Horizon. 1-3 yr $548.52 (analyst consensus (n=31)) — fundamentals + valuation re-rating. 5 yr $803.08 at ~21% CAGR — compounding case rests on the competitive position widening. 10 yr $1,191 if current growth sustains into durable earnings power.
11. CARG — CarGurus, Inc. · score 83.5
Auto & Truck Dealerships · price $35.77 · 1Y $41.50 · 5Y $60.76 · 10Y $90.13
FCF $315m C · Rev +13.9% B+ · D/E 0.70 B+ · P/E 18.4x B · PEG 1.10 B+
Why now. CarGurus’ Digital Deal platform is driving a 13.9% YoY revenue lift while the company’s free‑cash‑flow of $315 m fuels aggressive share buybacks, boosting earnings per share and keeping the share count lean – a recipe for sustained 15%‑plus growth. The combination of a 13.9% revenue rise, a 18.2% profit margin and a 66.6% ROE shows the business is already a high‑quality compounder, and the current price of $35.77 sits well below the analyst consensus of $41.50, making the upside clear.
Moat. The Digital Deal suite locks in consumers by letting them start purchases online and then visit dealers for final steps, creating a friction‑less funnel that competitors find hard to replicate without the same dealer network and data moat. This integrated buying experience drives repeat traffic and higher conversion rates, translating into the 18.2% profit margin and 66.6% ROE the company enjoys.
Risk. The biggest threat is the elevated P/E of 18.4, which already prices in aggressive revenue growth that may not sustain if the auto‑sales cycle slows or if competitors launch similar online‑to‑on‑lot solutions. A dip in the 13.9% revenue growth or a rise in the debt‑to‑equity ratio beyond 0.7 would erode margins and invalidate the buyback‑driven upside.
Horizon. 1-3 yr $41.50 (analyst consensus (n=12)) — fundamentals + valuation re-rating. 5 yr $60.76 at ~11% CAGR — compounding case rests on the competitive position widening. 10 yr $90.13 if current growth sustains into durable earnings power.
12. EXLS — ExlService Holdings, Inc. · score 83.2
Information Technology Services · price $34.56 · 1Y $44.38 · 5Y $64.97 · 10Y $96.38
FCF $297m C · Rev +13.4% B+ · D/E 0.57 C+ · P/E 21.9x B+ · PEG 1.03 B+
Why now. EXLS is poised to compound its earnings by leveraging its AI‑driven claims management and underwriting analytics platform in the Insurance segment, where it already commands deep client relationships. The business is delivering 13.4% revenue growth YoY, a rock‑solid ROE of 32.3% and $297 m of free cash flow that fuels ongoing buybacks, all of which sit under the Bull Rankings model’s strongest pillar – Growth – and a quality‑growth score of 83.2. The thesis rests on the ability to keep scaling these high‑margin AI services across its insured‑base, driving compounding returns.
Moat. The moat comes from the sticky, data‑intensive nature of its insurance analytics suite – clients embed EXLS’s AI engines into claims processing and policy servicing, creating high switching costs and a de‑facto data moat. This entrenched position fuels the 32.3% ROE by allowing premium pricing and cost efficiencies that competitors cannot replicate quickly.
Risk. The bear case hinges on the market pricing a premium P/E of 21.9 while the Bull Rankings model’s reverse‑DCF implies only ~3% free‑cash‑flow growth over the next decade, a stark mismatch to the current 13.4% revenue expansion; any slowdown or margin compression would expose that optimism. Additionally, a debt‑to‑equity of 0.57 adds leverage risk if the AI spend cycle softens. A breach of the 3% implied growth corridor would validate the skeptics.
Horizon. 1-3 yr $44.38 (analyst consensus (n=8)) — fundamentals + valuation re-rating. 5 yr $64.97 at ~13% CAGR — compounding case rests on the competitive position widening. 10 yr $96.38 if current growth sustains into durable earnings power.
13. EPAM — EPAM Systems, Inc. · score 82.5
Information Technology Services · price $98.73 · 1Y $122.82 · 5Y $179.83 · 10Y $266.76
FCF $483m C · Rev +10.8% B · D/E 0.04 A- · P/E 13.4x A · PEG 0.54 A-
Why now. EPAM’s platform‑engineering and AI services are cementing its role as the go‑to partner for enterprise digital transformation, and that stickiness fuels compounding earnings. The business is delivering 10.8% YoY revenue growth, a healthy 7.2% profit margin, and a modest PE of 13.4x while management is actively buying back shares, reinforcing the upside. The whole thesis rests on the persistence of high‑margin, recurring engineering contracts that keep cash flowing and earnings expanding.
Moat. The moat lives in EPAM’s end‑to‑end engineering practice—from requirements analysis to cloud migration and AI integration—which creates deep switching costs for large‑scale enterprise clients. Its low debt (DE 0.04) and ROE of 11.4% stem from pricing power in a niche where few rivals can match its breadth of services and integrated automation capabilities, locking customers into long‑term platform engagements.
Risk. The biggest headwind is the market’s implicit optimism: our reverse‑DCF shows the current price assumes only ~1% annual free‑cash‑flow growth for a decade, far below the 10.8% revenue growth the business is actually delivering. Coupled with a beta of 1.37, any slowdown in enterprise IT spend or a shift to lower‑cost offshore providers would force the valuation down sharply. A sustained miss on revenue growth would confirm the bear case.
Horizon. 1-3 yr $122.82 (analyst consensus (n=17)) — fundamentals + valuation re-rating. 5 yr $179.83 at ~13% CAGR — compounding case rests on the competitive position widening. 10 yr $266.76 if current growth sustains into durable earnings power.
14. LRN — Stride, Inc. · score 81.9
Education & Training Services · price $83.43 · 1Y $95.94 · 5Y $140.47 · 10Y $208.38
FCF $433m C · Rev +4.7% C+ · D/E 0.33 A- · P/E 11.7x A · PEG 0.49 A
Why now. Stride, Inc. is a deeply undervalued growth company, with our model's strongest pillar being Value (95/100), indicating significant market pessimism. The current price implies a staggering ~-11%/yr free-cash-flow growth sustained for 10 years, which is a stark contrast to its reported 4.7% FY YoY revenue growth and $433m in TTM free cash flow against a $3.5b market cap. This extreme discount, reflected in a P/E of 11.7 and a PEG ratio of 0.49, suggests the market is ignoring the company's consistent profitability and its strategic shift towards high-demand online coursework in software engineering and healthcare. The crux of the thesis is that the market will eventually re-rate LRN as it continues to generate substantial free cash flow, even with modest growth.
Moat. Stride's competitive advantage is rooted in its comprehensive, proprietary "end-to-end platform" which offers single sign-on, content management, learning management, student information, data reporting and analytics, and various support systems. This integrated ecosystem creates high switching costs for educational institutions and students, making it difficult for competitors to dislodge. The company's impressive 20.7% Return on Equity (ROE), a signal of efficient capital deployment and pricing power, is a direct result of this sticky platform and its ability to deliver specialized, state-customized curriculum and instructional supports, which our model identifies as a source of "Durable high returns."
Risk. The primary risk for Stride is its modest top-line expansion, reflected in our model's weakest pillar: Growth (67/100). The company's 4.7% FY YoY revenue growth is relatively slow for a "growth" category stock, raising concerns about market saturation in its core U.S. online education sector or intense competition for its online coursework in fields like software engineering. This slow growth, coupled with a remarkably low beta of 0.1, suggests the market may view Stride as a more mature business rather than a dynamic compounder. A sustained deceleration in revenue growth below the current 4.7% or a contraction in the 13.4% profit margin would confirm the bear case, validating the market's current pessimistic FCF growth expectations.
Horizon. 1-3 yr $95.94 (structural (no analyst coverage)) — fundamentals + valuation re-rating. 5 yr $140.47 at ~11% CAGR — compounding case rests on the competitive position widening. 10 yr $208.38 if current growth sustains into durable earnings power.
15. ADMA — ADMA Biologics, Inc. · score 81.7
Biotechnology · price $9.34 · 1Y $17.00 · 5Y $24.89 · 10Y $36.92
FCF $116m C · Rev +8.0% B · D/E 1.11 C · P/E 13.3x A- · PEG 0.57 A-
Why now. ADMA’s dominant position in the U.S. IVIG market fuels a high‑margin, cash‑generating engine that will compound earnings as the specialty plasma franchise expands. The business delivers a 33% profit margin and a stellar ROE of 41.4%, while revenue is still growing 8% YoY—a rare combination in biotech that lets the company reinvest cash into buybacks and capacity. The thesis rests on the continued uptake of BIVIGAM and ASCENIV among immunodeficiency patients, which should keep the compounding engine humming.
Moat. ADMA controls the entire plasma‑to‑product chain through its ADMA BioManufacturing and Plasma Collection Centers, creating high switching costs for hospitals that rely on its FDA‑approved IVIGs. This vertical integration, paired with pricing power reflected in a 33% margin and a 41.4% ROE, locks in cash flow that competitors cannot replicate without building costly collection networks.
Risk. The company’s debt‑to‑equity of 1.11 and a modest P/E of 13.3 signal that any slowdown in IVIG demand or pricing pressure could strain cash flow, especially if buyback funding dries up. A bear would see margin compression or a revenue growth dip below the current 8% pace, which would validate concerns that the stock’s upside is limited by financial leverage.
Horizon. 1-3 yr $17.00 (analyst consensus (n=5)) — fundamentals + valuation re-rating. 5 yr $24.89 at ~22% CAGR — compounding case rests on the competitive position widening. 10 yr $36.92 if current growth sustains into durable earnings power.
16. RMD — ResMed Inc. · score 81.4
Medical Instruments & Supplies · price $220.37 · 1Y $247.20 · 5Y $361.93 · 10Y $536.89
FCF $1.6b C+ · Rev +9.9% B · D/E 0.13 B+ · P/E 21.1x B+ · PEG 1.30 B
Why now. ResMed’s AirView cloud platform is turning its Sleep and Breathing Health segment into a high‑margin, recurring‑revenue engine, and that engine is expanding at a 9.9% YoY revenue growth rate while delivering a 26.9% profit margin and generating $1.6 B of free cash flow. Those fundamentals sit behind a low‑cost balance sheet (debt‑to‑equity 0.13) and a modest beta (0.75), giving the business the runway to compound earnings at double‑digit rates. The entire thesis hinges on AirView’s ability to lock in clinics and home‑care providers to its cloud‑connected diagnostics, turning each new device into a sticky data subscription.
Moat. The AirView ecosystem creates a switching cost for sleep clinics, hospitals and home‑care providers because the platform aggregates diagnostic data from ApneaLink Air, NightOwl and EasyCare Tx, delivering actionable insights that competitors can’t replicate without rebuilding a cloud‑infrastructure and regulatory approvals. ResMed’s 23.1% ROE reflects pricing power derived from its category‑leadership in cloud‑connected sleep‑apnea solutions, and the patented sensor technology in NightOwl locks in a technical advantage that slows new entrants.
Risk. The market is pricing ResMed for a growth story that may be overstated: a forward P/E of 21.1 implies a reverse‑DCF free‑cash‑flow growth of only ~4% per year, well below the actual 9.9% revenue growth and the 26.9% margin cushion, suggesting investors are already demanding premium pricing. If the AirView subscription uptake stalls or reimbursement pressure curtails device pricing, the gap between the implied 4% growth and real performance will widen, triggering a sell‑off. A sustained miss on the 4% FCF growth assumption would be the decisive signal that the bull case has unraveled.
Horizon. 1-3 yr $247.20 (analyst consensus (n=15)) — fundamentals + valuation re-rating. 5 yr $361.93 at ~10% CAGR — compounding case rests on the competitive position widening. 10 yr $536.89 if current growth sustains into durable earnings power.
17. PRDO — Perdoceo Education Corporation · score 81.2
Education & Training Services · price $32.04 · 1Y $34.60 · 5Y $43.69 · 10Y $56.03
FCF $221m C · Rev +11.7% B · D/E 0.11 A- · P/E 11.7x A · PEG 0.68 A-
Why now. Education & Training Services · market cap $2.0b. 17% off the 52-week high of $38.50. Revenue growing +12%, comfortably above the S&P median. PEG 0.68 — paying under fair value for the growth rate.
Moat. Net margin 21% sits well above the S&P median (~11%) — suggests structural pricing advantage or cost discipline competitors can't quickly close. ROE 17% sits above Buffett's preferred 15% threshold — the equity base is compounding at a rate the market struggles to discount accurately. FCF converts 125% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Value re-rating depends on a catalyst. Without one — analyst day, divestiture, margin recovery, capital return — the stock can stay cheap on these multiples for years.
Horizon. 1-3 yr $34.60 (structural (no analyst coverage)) — multiple re-rating thesis requires a catalyst. 5 yr $43.69 at ~6% CAGR — dividend + buyback compounding. 10 yr $56.03 if the moat survives secular pressure.
18. FISV — Fiserv, Inc. · score 80.3
Sector n/a · price $52.21 · 1Y $62.18 · 5Y $78.50 · 10Y $100.67
FCF $3.9b B · Rev +9.3% B · D/E n/a · P/E 10.0x A- · PEG 0.96 B+
Why now. Sector n/a · market cap $27.8b. Down 63% from 52-week high of $140.42 — deep drawdown territory. PEG 0.96 — paying under fair value for the growth rate. 28 sell-side analysts rate this a Hold with a mean 1-yr target of $62.18 (implying +19% upside).
Moat. Net margin 17% beats the market median by a meaningful margin — the company is keeping more of every revenue dollar than the average S&P constituent. ROE 10% meets the long-run market sustainable threshold — solid but not differentiated; the durability comes from elsewhere. FCF converts 140% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Down 63% from the 52-week high — the market is pricing in something the screen can't see; verify the bear case before sizing up.
Horizon. 1-3 yr $62.18 (analyst consensus (n=28)) — multiple re-rating thesis requires a catalyst. 5 yr $78.50 at ~8% CAGR — dividend + buyback compounding. 10 yr $100.67 if the moat survives secular pressure.
19. DECK — Deckers Outdoor Corporation · score 79.5
Footwear & Accessories · price $90.11 · 1Y $122.81 · 5Y $155.04 · 10Y $198.84
FCF $1.1b C+ · Rev +7.9% B · D/E 0.21 A- · P/E 12.8x A- · PEG 1.14 B+
Why now. Footwear & Accessories · market cap $12.3b. Down 28% from 52-week high of $125.45 — deep drawdown territory. 21 sell-side analysts rate this a Buy with a mean 1-yr target of $122.81 (implying +36% upside).
Moat. Net margin 18% beats the market median by a meaningful margin — the company is keeping more of every revenue dollar than the average S&P constituent. ROE 44% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. FCF converts 110% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Value re-rating depends on a catalyst. Without one — analyst day, divestiture, margin recovery, capital return — the stock can stay cheap on these multiples for years.
Horizon. 1-3 yr $122.81 (analyst consensus (n=21)) — multiple re-rating thesis requires a catalyst. 5 yr $155.04 at ~11% CAGR — dividend + buyback compounding. 10 yr $198.84 if the moat survives secular pressure.
20. ACN — Accenture plc · score 78.9
Information Technology Services · price $169.98 · 1Y $179.11 · 5Y $226.12 · 10Y $289.99
FCF $12.6b A- · Rev +6.7% C+ · D/E 0.25 B · P/E 13.6x A · PEG 1.29 B
Why now. Information Technology Services · market cap $104.0b. Down 42% from 52-week high of $291.09 — deep drawdown territory. 25 sell-side analysts rate this a Buy with a mean 1-yr target of $179.11 (implying +5% upside).
Moat. ROE 24% sits above Buffett's preferred 15% threshold — the equity base is compounding at a rate the market struggles to discount accurately. FCF converts 162% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined. $104.0b market cap gives the company enough scale to absorb fixed costs that subscale competitors can't, without yet being so large that growth has to come from acquisition.
Risk. Down 42% from the 52-week high — the market is pricing in something the screen can't see; verify the bear case before sizing up.
Horizon. 1-3 yr $179.11 (analyst consensus (n=25)) — multiple re-rating thesis requires a catalyst. 5 yr $226.12 at ~6% CAGR — dividend + buyback compounding. 10 yr $289.99 if the moat survives secular pressure.
21. CPAY — Corpay, Inc. · score 78.9
Software - Infrastructure · price $407.62 · 1Y $450.64 · 5Y $568.93 · 10Y $729.63
FCF $1.6b C+ · Rev +20.4% A- · D/E 2.75 D · P/E 24.8x B+ · PEG 0.95 B+
Why now. Software - Infrastructure · market cap $26.8b. 4% off the 52-week high of $425.95. Revenue growing +20%, comfortably above the S&P median. PEG 0.95 — paying under fair value for the growth rate. 14 sell-side analysts rate this a Buy with a mean 1-yr target of $450.64 (implying +11% upside).
Moat. Net margin 23% sits well above the S&P median (~11%) — suggests structural pricing advantage or cost discipline competitors can't quickly close. ROE 32% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. FCF converts 144% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. D/E 2.75 is elevated — limits strategic flexibility and raises refinancing exposure if rates stay higher for longer. Software — competitive moat is durable until it isn't; watch net revenue retention, gross margin trends, and any new market entrant with a fundamentally lower price point.
Horizon. 1-3 yr $450.64 (analyst consensus (n=14)) — multiple re-rating thesis requires a catalyst. 5 yr $568.93 at ~7% CAGR — dividend + buyback compounding. 10 yr $729.63 if the moat survives secular pressure.
22. GMED — Globus Medical, Inc. · score 78.8
Medical Devices · price $85.12 · 1Y $103.23 · 5Y $151.14 · 10Y $224.21
FCF $756m C+ · Rev +19.7% B+ · D/E 0.02 A- · P/E 21.8x B+ · PEG 1.49 B
Why now. Medical Devices · market cap $11.4b. 16% off the 52-week high of $101.40. Revenue growing +20%, comfortably above the S&P median. 13 sell-side analysts rate this a Buy with a mean 1-yr target of $103.23 (implying +21% upside).
Moat. Net margin 17% beats the market median by a meaningful margin — the company is keeping more of every revenue dollar than the average S&P constituent. ROE 11% meets the long-run market sustainable threshold — solid but not differentiated; the durability comes from elsewhere. FCF converts 141% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Mature compounder — the risk is paying up for quality at a moment when growth is decelerating. Watch for sequential revenue + margin trends; the inflection from "compounder" to "ex-compounder" is hard to spot until the multiple already started compressing.
Horizon. 1-3 yr $103.23 (analyst consensus (n=13)) — fundamentals + valuation re-rating. 5 yr $151.14 at ~12% CAGR — compounding case rests on the competitive position widening. 10 yr $224.21 if current growth sustains into durable earnings power.
23. TPR — Tapestry, Inc. · score 78.8
Luxury Goods · price $129.02 · 1Y $167.00 · 5Y $210.83 · 10Y $270.39
FCF $1.8b C+ · Rev +14.2% B+ · D/E 5.72 D · P/E 17.7x B+ · PEG 0.26 A
Why now. Luxury Goods · market cap $26.1b. Down 22% from 52-week high of $164.80 — deep drawdown territory. Revenue growing +14%, comfortably above the S&P median. PEG 0.26 — paying under fair value for the growth rate. 20 sell-side analysts rate this a Buy with a mean 1-yr target of $167.00 (implying +29% upside).
Moat. Net margin 19% beats the market median by a meaningful margin — the company is keeping more of every revenue dollar than the average S&P constituent. FCF converts 119% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. D/E 5.72 is elevated — limits strategic flexibility and raises refinancing exposure if rates stay higher for longer. Beta 1.46 implies above-market volatility — position-size to the drawdowns this name will produce in a market correction, not to its bull-case return.
Horizon. 1-3 yr $167.00 (analyst consensus (n=20)) — multiple re-rating thesis requires a catalyst. 5 yr $210.83 at ~10% CAGR — dividend + buyback compounding. 10 yr $270.39 if the moat survives secular pressure.
24. VEEV — Veeva Systems Inc. · score 78
Health Information Services · price $238.34 · 1Y $244.14 · 5Y $357.45 · 10Y $530.25
FCF $1.7b C+ · Rev +16.2% B+ · D/E 0.01 A- · P/E 42.3x C · PEG 1.10 B+
Why now. Health Information Services · market cap $38.7b. Down 23% from 52-week high of $310.50 — deep drawdown territory. Revenue growing +16%, comfortably above the S&P median. 28 sell-side analysts rate this a Buy with a mean 1-yr target of $244.14 (implying +2% upside).
Moat. Net margin 28% sits well above the S&P median (~11%) — suggests structural pricing advantage or cost discipline competitors can't quickly close. ROE 13% meets the long-run market sustainable threshold — solid but not differentiated; the durability comes from elsewhere. FCF converts 177% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Trailing P/E 42x sits well above the S&P median (~20x) — multiple compression is a real risk if revenue growth decelerates. P/S 11.7x embeds aggressive forward growth — disappointing top-line guidance would compress the multiple hard.
Horizon. 1-3 yr $244.14 (analyst consensus (n=28)) — fundamentals + valuation re-rating. 5 yr $357.45 at ~8% CAGR — compounding case rests on the competitive position widening. 10 yr $530.25 if current growth sustains into durable earnings power.
25. META — Meta Platforms, Inc. · score 77.9
Internet Content & Information · price $568.97 · 1Y $754.14 · 5Y $952.09 · 10Y $1,221
FCF $41.0b A · Rev +27.7% A- · D/E 0.43 B+ · P/E 21.4x B · PEG 0.88 B+
Why now. Internet Content & Information · market cap $1.4T. Down 28% from 52-week high of $790.80 — deep drawdown territory. Revenue growing +28% — in hypergrowth territory. PEG 0.88 — paying under fair value for the growth rate. 57 sell-side analysts rate this a Strong Buy with a mean 1-yr target of $754.14 (implying +33% upside).
Moat. Net margin 30% sits well above the S&P median (~11%) — suggests structural pricing advantage or cost discipline competitors can't quickly close. ROE 26% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. $1.4T market cap places it among the largest companies in the sector — distribution, R&D, and customer-acquisition costs amortize across a base peers can't replicate.
Risk. Value re-rating depends on a catalyst. Without one — analyst day, divestiture, margin recovery, capital return — the stock can stay cheap on these multiples for years.
Horizon. 1-3 yr $754.14 (analyst consensus (n=57)) — multiple re-rating thesis requires a catalyst. 5 yr $952.09 at ~11% CAGR — dividend + buyback compounding. 10 yr $1,221 if the moat survives secular pressure.
26. DXCM — DexCom, Inc. · score 77.5
Medical Devices · price $88.76 · 1Y $94.12 · 5Y $137.80 · 10Y $204.42
FCF $1.4b C+ · Rev +15.5% B+ · D/E 0.53 B · P/E 35.1x C+ · PEG 1.69 C+
Why now. Medical Devices · market cap $33.5b. 3% off the 52-week high of $91.96. Revenue growing +16%, comfortably above the S&P median. 25 sell-side analysts rate this a Strong Buy with a mean 1-yr target of $94.12 (implying +6% upside).
Moat. Net margin 20% sits well above the S&P median (~11%) — suggests structural pricing advantage or cost discipline competitors can't quickly close. ROE 38% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. FCF converts 141% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Beta 1.41 implies above-market volatility — position-size to the drawdowns this name will produce in a market correction, not to its bull-case return. Trailing P/E 35x sits well above the S&P median (~20x) — multiple compression is a real risk if revenue growth decelerates.
Horizon. 1-3 yr $94.12 (analyst consensus (n=25)) — fundamentals + valuation re-rating. 5 yr $137.80 at ~9% CAGR — compounding case rests on the competitive position widening. 10 yr $204.42 if current growth sustains into durable earnings power.
27. WMG — Warner Music Group Corp. · score 77.5
Entertainment · price $26.37 · 1Y $36.88 · 5Y $46.56 · 10Y $59.72
FCF $836m C+ · Rev +12.9% B+ · D/E 4.53 D · P/E 21.1x B · PEG 0.46 A
Why now. Entertainment · market cap $13.8b. Down 26% from 52-week high of $35.42 — deep drawdown territory. Revenue growing +13%, comfortably above the S&P median. PEG 0.46 — paying under fair value for the growth rate. 17 sell-side analysts rate this a Buy with a mean 1-yr target of $36.88 (implying +40% upside).
Moat. ROE 79% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. FCF converts 124% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. D/E 4.53 is elevated — limits strategic flexibility and raises refinancing exposure if rates stay higher for longer.
Horizon. 1-3 yr $36.88 (analyst consensus (n=17)) — multiple re-rating thesis requires a catalyst. 5 yr $46.56 at ~12% CAGR — dividend + buyback compounding. 10 yr $59.72 if the moat survives secular pressure.
28. MELI — MercadoLibre, Inc. · score 76.8
Internet Retail · price $1787.57 · 1Y $2,257 · 5Y $3,304 · 10Y $4,901
FCF $12.4b A- · Rev +41.2% A · D/E 1.69 C+ · P/E 48.7x D · PEG 1.31 B
Why now. Internet Retail · market cap $90.6b. Down 30% from 52-week high of $2548.50 — deep drawdown territory. Revenue growing +41% — in hypergrowth territory. 24 sell-side analysts rate this a Buy with a mean 1-yr target of $2,257 (implying +26% upside).
Moat. ROE 24% sits above Buffett's preferred 15% threshold — the equity base is compounding at a rate the market struggles to discount accurately. Free cash flow runs well ahead of reported net income — non-cash charges (depreciation, intangible amortization) are holding down GAAP earnings while cash generation stays strong. $90.6b market cap gives the company enough scale to absorb fixed costs that subscale competitors can't, without yet being so large that growth has to come from acquisition.
Risk. Trailing P/E 49x sits well above the S&P median (~20x) — multiple compression is a real risk if revenue growth decelerates. E-commerce competition — Amazon, Walmart, Shein, and Temu have each forced the rest of the category to compete on price, fulfillment speed, or assortment; sustaining margins requires one of those being structurally defended.
Horizon. 1-3 yr $2,257 (analyst consensus (n=24)) — fundamentals + valuation re-rating. 5 yr $3,304 at ~13% CAGR — compounding case rests on the competitive position widening. 10 yr $4,901 if current growth sustains into durable earnings power.
29. YUMC — Yum China Holdings, Inc. · score 75.8
Restaurants · price $47.14 · 1Y $62.05 · 5Y $90.85 · 10Y $134.77
FCF $940m C+ · Rev +8.8% B · D/E 0.38 A- · P/E 17.3x B+ · PEG 1.19 B+
Why now. Restaurants · market cap $16.1b. 19% off the 52-week high of $58.39. 21 sell-side analysts rate this a Strong Buy with a mean 1-yr target of $62.05 (implying +32% upside).
Moat. ROE 18% sits above Buffett's preferred 15% threshold — the equity base is compounding at a rate the market struggles to discount accurately. FCF converts 96% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Mature compounder — the risk is paying up for quality at a moment when growth is decelerating. Watch for sequential revenue + margin trends; the inflection from "compounder" to "ex-compounder" is hard to spot until the multiple already started compressing.
Horizon. 1-3 yr $62.05 (analyst consensus (n=21)) — fundamentals + valuation re-rating. 5 yr $90.85 at ~14% CAGR — compounding case rests on the competitive position widening. 10 yr $134.77 if current growth sustains into durable earnings power.
30. CCK — Crown Holdings, Inc. · score 75.5
Packaging & Containers · price $116.24 · 1Y $136.57 · 5Y $172.42 · 10Y $221.12
FCF $1.2b C+ · Rev +10.3% B · D/E 1.86 C+ · P/E 16.7x B+ · PEG 0.64 A-
Why now. Packaging & Containers · market cap $12.6b. 5% off the 52-week high of $122.91. Revenue growing +10%, comfortably above the S&P median. PEG 0.64 — paying under fair value for the growth rate. 14 sell-side analysts publish a mean 1-yr target of $136.57 (implying +17% upside).
Moat. ROE 27% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. FCF converts 153% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined.
Risk. Value re-rating depends on a catalyst. Without one — analyst day, divestiture, margin recovery, capital return — the stock can stay cheap on these multiples for years.
Horizon. 1-3 yr $136.57 (analyst consensus (n=14)) — multiple re-rating thesis requires a catalyst. 5 yr $172.42 at ~8% CAGR — dividend + buyback compounding. 10 yr $221.12 if the moat survives secular pressure.
Methodology footnote
Every pick on this list comes out of the same quality-growth model — one 0–100 score blending quality, growth, and value — applied to every US-listed common stock with a market cap above $1B. Each pick's score breakdown is auditable from the home page — click the ticker on the rankings page to see exactly which grades produced the number. Not investment advice. See terms for full disclosures.