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The W.
@thewolfofallstreetz
1Sem.·

10 listed companies with the highest pricing power

ASML $ASML (-0,72 %) (semiconductor equipment)

Visa $V (-0,16 %) (payment transactions)

Mastercard $MA (-0,3 %) (payment transactions)

Moody's $MCO (-1,54 %) (credit ratings)

S&P Global $SPGI (-0,29 %) (credit ratings and indices)

Hermès $RMS (+0,11 %) (luxury goods)

Fair Isaac Corporation $FICO (-1,51 %) (credit scoring)

Coca-Cola $KO (+2,3 %) (beverages)

Apple $AAPL (+0,26 %) (consumer electronics and technology)

Nvidia $NVDA (-3,63 %) (AI and GPUs)


Also also worth mentioningbut not in the top 10:


Transdigm $TDG (-1,3 %) (aerospace)

MSCI $MSCI (+1,13 %) (financial services)

Cadence $CDNS (-4,03 %) (EDA software)

Synopsys $SNPS (-3,7 %) (EDA software)

Ferrari $RACE (+0,02 %) (luxury cars)


What do you think? Have I forgotten an interesting company / share?

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9 Commentaires
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connorc432@connorc432
1Sem.
Microsoft $MSFT and Costco $COST
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The W.@thewolfofallstreetz
1Sem.
@connorc432 Only to a limited extent, right? Microsoft has lower margins and significantly more competition than the companies mentioned above, e.g. in the cloud sector with AWS, Google Cloud, etc. Customers can switch if Microsoft becomes too expensive. On Costco: Costco thrives on keeping prices low for customers. They sell large volumes at low margins. They have a good business model, but no pricing power in my view.
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connorc432@connorc432
1Sem.
@thewolfofallstreetz the way that I was looking at it is Microsoft core operating system business is essential in the United States. 95%+ of business large or small is done on Windows and uses Microsoft 365 . Microsoft is so entrenched into corporate America it is insane. I think that they could raise the prices of 365 tomorrow and no one would bat an eye. Their cloud business is still only 35% of revenue albeit growing faster. I agree with you on their competitors I believe AWS and Google will trounce Azure in 10 years.

Costco I was looking at from the perspective of their membership business. They have a 93% renewal rate on 1 billion plus in revenue each quarter that is 100% margin. This contributes to about 65% of their net income. Fantastic business and Costco members would willingly pay so much more than they currently do for their memberships which can be seen in the recent increase with rising renewal rates indicating that they think it is cheap for value provided. Costco membership is only $5/month right now which sounds crazy typing up. I'd gladly pay $10/month for the basic membership.
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The W.@thewolfofallstreetz
1Sem.
@connorc432 Thanks for the great comment! I agree with you on the 365 business of Microsoft, yet not on the overall company having top-10 greatest pricing power. I also agree with you on your assessment of Costco. However, consider the following: There are alternatives to the Costco membership and they have no pricing power on the actual products they sell. Costco is not as irreplaceable as ASML, Visa or FICO in my opinion.
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connorc432@connorc432
1Sem.
@thewolfofallstreetz very true and I agree with your assessment as well. I have invested in or am invested in all of your top 10 with the exception of Hermes as I recognize how valuable these companies are. Great list!
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The W.@thewolfofallstreetz
1Sem.
@connorc432 Wow, congrats. Happy to add any other company that I might have missed.
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Lord P.@lordprettylambo
1Sem.
With pricing power, you can sleep soundly with all these stocks in any market situation.
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Sansebastian@Sansebastian
1Sem.
@lordprettylambo if you can't sleep peacefully because of the stock market or your portfolio, then something is wrong anyway ☝🏻
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Lord P.@lordprettylambo
1Sem.
@Sansebastian Don't worry about me. I sleep well even with an 80% portfolio drawdown if I am invested in good companies.
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