Quality compounder

Bullish

High gross profitability + not expensive + clean accounting. The kind of business Buffett writes about.

PRIMARY SOURCE

Novy-Marx 2013

Piotroski 2000

TYPICAL HORIZON

6-12 months

FACTORS USED

qualityvalueaccruals

What it means

The business generates high gross margins (pricing power), trades at a reasonable multiple (not frothy), and its earnings quality is clean (real cash flow, not accrual accounting tricks). These businesses compound value over years, not quarters.

Why it works

Novy-Marx 2013 showed that gross profitability is the strongest quality predictor of future returns — stronger than ROE or net margin. Combined with Piotroski F-Score clean-accounting screen, the signal is durable across regimes.

Watch out

Quality companies can still be overvalued. If the market has already priced in the compounding, expected returns shrink to the cost of capital. Pattern fires most usefully when there's also an earnings catalyst or mean-reverting valuation compression.

Live matches

50 tickers firing right now

TickerCompanySectorChangeScore

NUNu HoldingsFinancials+1.64%80[34–95]GOOGAlphabet Inc. Class CTechnology-0.48%76[30–95]GOOGLAlphabet Inc.Technology-0.36%76[30–95]MOAltria GroupConsumer+1.64%74[28–95]0388.HKHong Kong ExchangesFinancial Services+2.01%73[27–95]INVE-B.STInvestor ABFinancial Services+0.93%72[26–95]ABX.TOBarrick GoldBasic Materials+2.21%71[25–95]LINLinde plcMaterials+2.45%70[24–95]FASTFastenal CompanyIndustrials+1.78%70[24–95]ACGLArch Capital GroupFinancial Services+3.70%69[23–95]SOL.AXWH Soul PattinsonFinancial Services+1.56%68[22–95]VZVerizon CommunicationsCommunication+1.36%68[22–95]WPMWheaton Precious MetalsBasic Materials+3.85%68[22–95]TCEHYTencent HoldingsTechnology-1.51%66[20–95]BHP.AXBHP GroupBasic Materials+1.56%65[19–95]ALLAllstate CorpFinancial Services+2.97%65[19–95]TAT&T Inc.Communication+0.49%64[18–95]005930.KSSamsung ElectronicsTechnology+8.22%63[17–95]6098.TRecruit HoldingsIndustrials+2.49%63[17–95]O39.SIOCBC BankFinancial Services+0.92%63[17–95]PDDPDD Holdings (Pinduoduo)Technology-0.16%63[17–95]6857.TAdvantest CorporationSemiconductors+1.84%63[17–95]NDAQNasdaq Inc.Financial Services+2.33%63[17–95]KVUEKenvue Inc.Consumer+2.59%63[17–95]SAPSAP SETechnology+2.16%63[17–95]FNFFidelity National FinancialFinancial Services+1.90%62[16–95]HESAYHermès InternationalConsumer+3.64%62[16–95]PMPhilip Morris InternationalConsumer+2.58%62[16–95]MSFTMicrosoft CorporationTechnology+1.62%62[16–95]FRTFederal Realty TrustReal Estate+1.06%62[16–95]9999.HKNetEase Inc.Technology+2.70%61[15–95]0027.HKGalaxy EntertainmentConsumer Cyclical+2.31%61[15–95]SAN.MCBanco SantanderFinancial Services+0.99%61[15–95]0883.HKCNOOC LimitedEnergy+3.82%61[15–95]4911.TShiseido CompanyConsumer Defensive+2.10%61[15–95]RPRXRoyalty PharmaHealthcare+3.57%61[15–95]SFStifel FinancialFinancial Services+1.84%61[15–95]RY.TORoyal Bank of CanadaFinancial Services+0.26%61[15–95]BRBroadridge FinancialTechnology+2.14%60[14–95]IDEXYIndustria de Diseño TextilConsumer+2.73%60[14–95]PGProcter & GambleConsumer+2.70%60[14–95]HIGHartford FinancialFinancial Services+2.96%60[14–95]4519.TChugai PharmaceuticalHealthcare+2.99%60[14–95]035720.KSKakao Corp.Technology+0.71%60[14–95]MFC.TOManulife FinancialFinancial Services+0.74%60[14–95]FCXFreeport-McMoRanMaterials+0.73%60[14–95]AFLAflac Inc.Financial Services+2.02%59[13–95]BIIBBiogen Inc.Healthcare+3.04%59[13–95]BKBank of New York MellonFinancial Services+0.00%59[13–95]UBSG.SWUBS GroupFinancial Services+0.46%59[13–95]

Disclaimer. Pattern matches are research signals, not investment advice. Past performance of an academic effect does not guarantee future returns. Forward-return tracking for Framler's own implementation begins 2026-05-16 after the calibration window closes.