Verisk Analytics is a regulatory-grade data toll on the US property & casualty insurance industry, monetized through ~83% subscription revenue with ~92% client retention. VRSK's narrow-moat franchise produces FCF with an unusually high degree of predictability, durable enough to justify a 15× exit multiple at a 35% margin of safety.Read more

NVR converts the most capital-intensive, most cyclical, most balance-sheet-fragile activity in U.S. industrial business — residential land development — into a software-like compounder with 30% ROIC and net-cash balance sheets. The mechanism is the Lot Purchase Agreement (LPA) model: NVR pays non-refundable deposits of ~10% of finished lot value to third-party developers for the right to take down lots on a quarter-by-quarter basis.Read more

Rollins is the dominant pure-play compounder in global pest control — a structurally necessary, recession-resistant service business that has grown revenue for 24 consecutive years and delivered ROIC of 23–31% for 12 consecutive years, without a single year of ROIC below 21% even through COVID-19. The investment thesis rests on three mutually reinforcing pillars: (1) a Wide Moat rooted in switching costs — commercial customers cannot switch providers without triggering compliance risk, and residential customers renew habitually at annual price increases of 3–4% above CPI without meaningful churn; (2) a proven M&A flywheel that converts a fragmented industry of 34,000+ U.S. operators into compounding route density and FCF, completing 30–45 bolt-on acquisitions annually at disciplined multiples with zero reported impairments; and (3) a capital-light business model with minimal reinvestment needs, generating FCF of $678M in FY2025 on $3.76B of revenue.Read more

Tyler Technologies is the dominant software platform for U.S. state and local government — a market defined by mission-critical workflows, 12–24 month implementation cycles, and a procurement environment that structurally protects incumbents. The investment thesis is built on three compounding forces: (1) a largely complete SaaS cloud transition that is converting a high-gross-margin subscription base from flat to accelerating, with ARR already at $2.06B and growing 11% annually; (2) a payments platform (NIC) that turns Tyler’s 40,000+ client relationships into a recurring transaction revenue stream now generating $808M per year and growing at double digits; and (3) a Tyler 2030 strategic roadmap that articulates a credible path to 30%+ non-GAAP operating margins by the end of the decade.Read more

Copart is a compounding machine wearing the clothes of a salvage yard. It has built the only infrastructure on earth — a two-sided digital marketplace spanning 1M+ registered buyers in 190+ countries, anchored by owned physical storage across 21,000+ irreplaceable acres — capable of converting an insurance industry's inconvenient problem (the totaled car) into global liquidity at scale.Read more

Moody's Corporation is a regulatory-moated oligopoly wrapped in a compounding software business. The MIS ratings franchise holds the most durable structural position in financial services: NRSRO designation is a legal prerequisite for capital adequacy calculations in virtually every major financial market globally, the duopoly with S&P has been unbroken for over four decades, and the proprietary century-old default database cannot be replicated at any cost.Read more

MSCI is a Wide Moat compounding machine whose index benchmarks serve as the institutional standard for $16.5 trillion in global AUM, generating 75%+ recurring revenue at 93-95% retention rates and approximately 50% FCF margins. The investment thesis rests on three durable pillars: (1) permanent switching costs in the Index segment, where fund mandate rewrites, LP notifications, and derivative contract renegotiations make benchmark migration prohibitively costly for all but the most determined sponsors; (2) secular tailwinds from the continued growth of passive investing and the institutionalization of private markets, which expand MSCI's AUM-linked revenue with zero incremental cost; and (3) an emerging private assets franchise replicating the Index playbook in a $10 trillion+ private equity and credit market that currently lacks institutional-grade benchmarks.Read more

Visa executes steadily on its three-pillar strategy: Consumer Payments volume growing 8-9% in constant dollars driven by secular cash-to-card conversion and cross-border recovery; CMS at ~20% initially decelerating to ~12% by FY30; VAS sustaining 20-25% growth before decelerating to ~15% by FY32 as the business matures. The DOJ antitrust case resolves with a monetary settlement and limited routing adjustments — painful but not structurally disruptive to the debit network economics.Read more

This company helps insurers and healthcare groups turn their data into action and run day-to-day work through digital tools, and it may get a new lift as more businesses adopt generative AI and move data to the cloud. But it leans heavily on a small group of big customers and on employee pay costs, so a change in either could quickly reshape results.Read more