Our indicative theme on Expensive Performers – which includes companies trading at increasingly higher valuation multiples but are executing well, with consistently expanding Operating Margins and Revenues – is up by about 39% year-to-date on an equally weighted basis. This compares to the S&P 500 which is up by just about 5% over the same period. We believe that companies in this theme are likely building a competitive advantage in the businesses they are operating in, implying that earnings growth could be stronger going forward. Veeva Systems (VEEV), up 96% year-to-date, is the biggest driver of the theme’s return this year. On the other side, Heico (HEI) stock is down by about -7% year to date. Below is a quick rundown of some of the stocks and their performance over the past year.
See our theme on Expensive Performers for detailed criteria for picking the stocks in the theme.
Veeva Systems (VEEV) is a cloud-computing company focused on applications for the pharmaceutical and life sciences industry. The stock is up by 96% year-to-date. (related: Veeva Systems & Ansys – Two Software Stocks You May Have Overlooked)
ServiceNow (NOW) develops a cloud computing platform to help companies manage digital workflows for enterprise operations, The stock is up by 75% year-to-date.
Pool Corporation (POOL) is a wholesale distributor of swimming pool supplies and equipment. The stock is up by 53% year-to-date.
IDEXX Laboratories (IDXX) sells products and services catering to the companion animal veterinary, livestock and poultry, water testing, and dairy markets. The stock is up by 47% year-to-date.
MSCI (MSCI) is a financial data provider that is best known for its financial indices, which money managers use to benchmark investment performance. The stock has gained 35% year-to-date.
Heico Corporation (HEI) is an aerospace and electronics company that focuses on relatively niche markets. The stock is down by about -7% year-to-date.high-quality portfolio to beat the market
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