No. of Recommendations: 23
Besides Berkshire, mostly a few oligopolistic contenders:
Visa and Mastercard
Moody's and S&P Global
Canadian Pacific Kansas City
Copart
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Nice thoughtful list, thanks. I like the Visa idea. Moody's, railway, I see the unkillability case. (I used to work for CN, so CP is not entirely unknown)
But I know precisely nothing about Copart. What's the elevator pitch in this context?Sorry about the delay, Jim. I recently finished a long, time-consuming project. Plus, I started thinking about an elevator pitch and realized it was going to take a bunch of reading, thought, and writing before I could drum one up. All of that took a few days!
The elevator pitch is that Copart is a high-quality duopoly business with a moat, barriers to entry, industry tailwinds, high return on capital, balance sheet strength, economic stability, and good capital allocation. I had to write an investment thesis to come up with the elevator pitch. I posted the thesis on the Copart board (the board’s initial post):
https://www.shrewdm.com/MB?pid=81057458I’m hoping some folks here will head over to that board to read it and post their comments there, especially pointing out any errors (likely!) and missing pieces (assured!). Until last year when I was gainfully employed, I mostly bought stocks in group purchases in fairly mechanical fashion. But now that I’m retired, I hope to do more in-depth research on individual names, putting my theses to paper/cyberspace. This was my first attempt, but my research continues on this company.
P.S. If you like unkillability, you probably can’t do much better than Sir Christopher Hohn’s portfolio holdings at TCI Fund Management Ltd (The Children’s Investment Fund). He loves “opolies” of all sorts (mon, du, and olig). SEC’s EDGAR site shows only nine TCI holdings on Form 13F. But Tikr.com shows four additional holdings, sourced via company shareholder reports. I found one other possible current or recent holding in a couple of articles at reputable sites. Let’s call it fourteen holdings in total (Bonus: Eight of the fourteen are outside the United States):
GE Aerospace (US) and Safran SA (France): Part of an oligopoly that manufactures large aircraft engines for commercial and defense use. Other members include Pratt & Whitney (US, part of RTX Corp.) and Rolls-Royce (UK).
Airbus SE (Netherlands): Part of a duopoly that manufactures large commercial jet airliners. The other member is Boeing (US).
Aena S.M.E., S.A. (Spain): A monopoly that consolidates and controls almost all public airport assets in Spain.
Ferrovial SE (Netherlands) and Vinci (France): Part of an oligopoly that constructs and operates global infrastructure (toll roads, airports, energy infrastructure, etc.) In some contexts, these two operate as local monopolies in various aspects of their businesses. The oligopoly includes several other members around the globe.
Canadian National Railway (Canada) and Canadian Pacific Kansas City (Canada): Both members of a duopoly that shares the Canadian freight railway market. Both are also part of an oligopoly that shares the North American freight railway market. Other oligopoly members include BNSF (US, part of Berkshire Hathaway), CSX (US), Norfolk Southern (US), and Union Pacific (US).
Cellnex Telecom, S.A. (Spain): Part of an oligopoly that operates European wireless telecommunications infrastructure (cell towers). Other members include American Tower (US), GD Towers (Germany, owned by Deutsche Telekom), Infrastrutture Wireless Italiane S.p.A., also known as INWIT (Italy), TOTEM (France, owned by Orange S.A.), and Vantage Towers (Germany).
Visa (US): Part of a duopoly that controls the global payment card network market. The other member is MasterCard (US).
Moody’s (US) and S&P Global (US): Part of an oligopoly that provides global credit ratings on large corporate bond issuances. The other member is Fitch Ratings (US, privately owned by Hearst Communications).
Alphabet (US): A monopoly that offers online search and online search advertising; and part of an oligopoly that offers cloud computing, AI, and digital ad spending (among other offerings). Other oligopoly members include Amazon (US), Apple (US), Microsoft (US), and Meta (US).
Microsoft (US): A monopoly that offers desktop operating systems (Windows) and enterprise productivity software (Office); and part of an oligopoly that offers cloud services, AI, and gaming (among other offerings). Other oligopoly members include Alphabet (US), Amazon (US), and Apple (US).
