Not all Tier A is equal. We screened 187 serial acquirers across 14 markets and found 59 that earn above a 12% cost of equity. That’s the starting point — not the endpoint. Fifty-nine companies clear the bar. What separates the durable compounders from the fragile survivors is how far above the bar they sit, how much goodwill they carry, and whether their ROIC is rising or falling.

Part of our Global Serial Acquirer Scorecard

Twelve companies in our Tier A universe earn between 12.0% and 13.0% ROIC. Constellation Software — the gold standard the industry benchmarks against — fell from 25-35% ROIC to 10.8% over fifteen years and now sits in Tier B. That trajectory is the investor’s warning: Tier A status is not permanent. We rank the 59 by quality so you know which ones to research and which to watch carefully.

Key Finding: Of 59 serial acquirers earning above 12% ROIC globally, 16 qualify as Elite — ROIC above 20% with structural moats. Twenty-three sit in the Strong tier at 15-20% ROIC. Twenty are Fragile — clearing 12% today but one bad deal from falling below cost of capital. Within the Fragile tier, six companies have both high goodwill (above 39% GW/TA) and declining ROIC trends, making them the highest-risk Tier A names globally.

The Framework: What Makes Tier A Durable

Mauboussin & Callahan (2023) found that 48% of top-ROIC-quintile companies remain there after three years. The other 52% fall. We use three filters to estimate which of our 59 are in the durable half.

ROIC level. Higher ROIC provides more buffer against acquisition mistakes. A company at 25% ROIC can survive a deal that costs 10 percentage points; a company at 13% ROIC cannot. Companies above 20% earn 2-3 standard deviations above the Russell 3000 median of 9.5% found by Mauboussin & Callahan (2023). That cushion matters.

Goodwill intensity. Above 40% GW/TA, only 24% of companies in our 14-market screen earn above cost of capital. The math is hostile: goodwill in the denominator inflates invested capital, compressing ROIC mechanically as the balance sheet fills with acquisition premiums. Companies below 20% GW/TA have a clean structural advantage.

ROIC trend. A declining 14% ROIC is more dangerous than a rising 10% ROIC — the trajectory reveals whether the acquisition machine is working. We flag companies where ROIC has declined more than 3 percentage points over five years, regardless of current level.

Best Serial Acquirers 2026: Elite Compounders (ROIC Above 20%)

Sixteen companies across 14 markets earn above 20% ROIC with goodwill in the denominator. These are not borderline cases — they earn 2x cost of capital or better, even after including every acquisition premium paid.

Four observations on this list. First, Japan contributes seven of nineteen rows — but four of those six carry zero goodwill and do not acquire in any meaningful sense. Nihon M&A Center, Disco, Keyence, and MonotaRO are organic growers included because investors frequently group them with serial acquirers. The highest ROIC for a genuine Japanese acquirer (GW/TA above 3%) is Recruit at 41.2%, driven almost entirely by Indeed’s dominance in job search.

Second, Dover at 28.7% ROIC stands out as anomalous — prior years show 12.5%, 13.7%, 16.0%. The latest-year spike likely reflects divestiture gains. We treat Dover as a normalized ~13% ROIC company for ranking purposes; it belongs analytically in the Strong tier, not Elite.

Third, ISS at 21.7% ROIC earned that number after restructuring from a -54% ROIC trough. The company is a turnaround, not a compounder. ROIC history spanning -54% to +22% is not what Elite means.

Fourth, Rollins is the most durable high-ROIC acquirer with significant goodwill (41% GW/TA). Twenty years of 20-30% ROIC. Pest control generates recurring revenue with pricing power — one of the few businesses where acquisition premiums compound rather than erode.

The genuine Elite — ROIC above 20%, real acquisition history, structural moats — narrows to ten: Recruit, Hoya, Logista, Illinois Tool Works, Technology One, Kone, OEM International, Rollins, Recordati, Geberit. ITW achieved its ROIC by stopping acquisitions — the best serial acquirer in the US is the one that quit.

Strong Compounders: ROIC 15-20%

Twenty-three companies earn 15-20% ROIC. These are the workhorses — consistent value creators with enough ROIC buffer to absorb an average acquisition without falling below cost of capital.

Five names in this tier carry specific risk flags.

Amadeus Fire at 15.7% ROIC looks healthy — but the company earned 49% ROIC before a single acquisition drove GW/TA from 8% to 52%. The underlying staffing business is world-class. The acquisition destroyed two-thirds of returns. Whether Amadeus Fire stays Tier A depends on whether management makes another large deal.

Nemetschek at 14.5% ROIC carries 53% GW/TA that doubled in one year (EUR 552M to EUR 1,135M). Architecture software with 24.1% margins saves it — the same margin-absorbs-goodwill pattern as Wolters Kluwer at 50% GW/TA. But 53% GW/TA combined with a one-year doubling demands monitoring.

Momentum Group at 14.6% ROIC has declined from 32% over five years. Still above cost of capital, still earning the Bergman family premium — but the trajectory is wrong. Bergman DNA may stabilize it. If acquisition pace accelerates, it doesn’t.

Grafton Group at 14.9% spiked from 4.9% — the largest single-year ROIC increase of any company in our screen. Prior years show persistent sub-5% ROIC. One-time gains or genuine operational improvement? Monitor the next two years before treating it as a proven Tier A name.

Veralto has only 4 data points post-spinoff from Danaher (Sep 2023). Water quality and product identification — the best unit from the Danaher tree. 18.7% ROIC with 42% GW/TA and 23.3% operating margins follows the elite-margins-overcome-goodwill pattern. Four data points is not a track record.

The genuine stalwarts in this tier: Wolters Kluwer (two decades of compound), AddTech and Lagercrantz (decades of Bergman-model proof), Reply (ten consecutive years above 15%), Watsco (lowest goodwill in the US at 10% GW/TA), and Schindler (elevator duopoly, 9% GW/TA despite decades of acquisitions).

Fragile Survivors: ROIC 12-14%

Twenty companies earn between 12.0% and 13.9% ROIC. These are the hardest to evaluate. They clear cost of capital today. One bad deal — or two average deals in a row — drops them below the threshold. Constellation Software was in this range before declining to 10.8%.

Five companies sit between 12.0-12.3% ROIC: Bureau Veritas (12.2%), Bucher Industries (12.2%), CGI Group (12.3%), Enghouse Systems (12.1%), and Roko (12.0%). A single acquisition that costs 3 percentage points of ROIC — the average outcome of a large deal across our 14-market screen — drops any of them below cost of capital.

Three carry specific structural concerns.

Sonova at 12.5% ROIC with 41% GW/TA and a declining trend. Hearing aid duopoly with Demant — which has already fallen to 10.0% ROIC as competitive pressure and acquisitions compounded. If Demant’s trajectory previews Sonova’s, Sonova is already past the inflection point.

Lifco at 12.4% ROIC with 39% GW/TA is one acquisition from crossing the 40% threshold. Carl Bennet’s creation has the best operating margins (18.7%) of any Swedish acquirer — those margins have protected it so far. But ROIC has been declining for five consecutive years. In the Swedish benchmark, eight of nine companies above 40% GW/TA earn below cost of capital. Lifco’s 18.7% margins are the only reason it survives at 39%.

Enghouse Systems at 12.1% ROIC has declined from 21% over five years. The same trajectory that took Constellation Software from the high-teens to 10.8%. Both are Canadian VMS acquirers. Both have seen deal multiples rise as competition for vertical software targets intensified. Enghouse at 12.1% today is where CSU was before it crossed below the threshold.

The Fragile tier’s two low-risk names: Viscofan and ARB Corp. Both carry near-zero goodwill (1% and 5% GW/TA respectively) and earn above cost of capital through genuine operational advantages — not acquisition accounting. Viscofan is an organic grower in food casings. ARB Corp dominates Australian 4WD accessories. Neither is structurally fragile; they are fragile only because of their ROIC level, not goodwill risk.

The Tier B Watchlist: Closest to Re-Entry

Nineteen companies across all 14 markets earn between 10-12% ROIC — Tier B, borderline. Three are worth monitoring as potential Tier A candidates.

VBG Group (SE, 11.9% ROIC, 20% GW/TA) — the Krefting family’s truck coupling and industrial business. ROIC has been improving. 20% GW/TA is the second-lowest in the Swedish screen after OEM International. If ROIC crosses 12%, VBG is the next Bergman-style compounder.

Descartes Systems (CA, 11.2% ROIC, 56% GW/TA) — improving from 5% ROIC. Logistics software with 29% operating margins. The high GW/TA (56%) is the primary risk — but the trajectory suggests the integration model works. If ROIC reaches 12%, the goodwill-absorption pattern resembles Canada’s CGI Group, which has maintained 12-14% at 60% GW/TA for over a decade.

Bossard (CH, 10.5% ROIC, 0% GW/TA) — fastener distributor in a cyclical trough. Mid-cycle ROIC is 15%+. Zero goodwill. If the industrial cycle normalizes, Bossard returns to the Strong tier organically without making a single acquisition.

Cross-Market Quality Rankings

The 59 Tier A companies span 14 markets. The most durable cohorts come from markets with structural balance sheet discipline.

Switzerland leads on quality, not just quantity. Eight of thirteen Swiss companies earn above cost of capital — the highest Tier A rate of any market (62%). Average GW/TA of 17% means the Tier A names start from clean balance sheets. Sonova (12.5% ROIC, 41% GW/TA, declining) is the one Swiss exception — high goodwill and a falling trajectory. The rest follow the model: avoid goodwill or earn elite margins. That discipline produces the most durable Tier A cohort globally.

Sweden has six Tier A companies but three carry elevated risk: Roko is unproven (IPO March 2025), Lifco is declining toward the 40% GW/TA cliff, and Momentum Group has fallen from 32% ROIC to 14.6% over five years. The two cleanest Swedish names — OEM International and the Bergman pair (AddTech, Lagercrantz) — belong in different conversations from the rest.

Japan contributes eight names but four are organic growers with zero goodwill. The genuine Japanese acquirer story is Hoya — 30.8% ROIC with 4.2% GW/TA, disciplined medical and optical acquisitions, and one of the best risk/reward profiles in the entire 59-company universe.

Canada — birthplace of the serial acquirer model — produces only two Tier A names. Both are in the Fragile tier. CGI Group has maintained 12-14% ROIC for over a decade at 60% GW/TA — the strongest goodwill-cliff exception in any market. Enghouse Systems is declining. The market that invented the model has the worst outcomes.

United States has six Tier A names with 22.4% average operating margins — the highest of any market. Those margins absorb the 43% average GW/TA. Illinois Tool Works, Rollins, and Watsco are the most durable. Broadridge is improving. Veralto remains unproven.

The Best Risk/Reward Profiles

We define best risk/reward as ROIC above 15%, GW/TA below 20%, and a drawdown that provides a margin of safety relative to fundamentals.

Straumann deserves a specific note: 16.7% ROIC, 24.0% operating margins, 16% GW/TA — yet trading at -58.3% drawdown. GLP-1 fears (weight loss drugs potentially reducing demand for dental implants) have compressed the stock despite 10% revenue growth in fiscal 2025. The fear is speculative; the ROIC is real. This is the most anomalous quality-drawdown dislocation in the Swiss market.

M3 (Japan) at 15.8% ROIC and -87.2% drawdown is the most extreme quality-drawdown dislocation in the entire 59-company universe. COVID-era healthcare IT euphoria inflated the stock to 150x earnings in 2021. The company still creates value — the market priced in a decade of growth that didn’t materialize. Fundamental ROIC intact; starting valuation was the problem.

Wolters Kluwer at 19.7% ROIC and -65.9% drawdown is the deepest drawdown on any Tier A name in the Netherlands universe. Information services with a regulatory moat. Fifty percent GW/TA absorbed by 24.6% operating margins — the same formula that keeps Rollins (41% GW/TA, 19.4% margins, 23.9% ROIC) in the Elite tier.

The Decision Framework

When evaluating the 59 Tier A names, four questions determine quality rank.

1. Does ROIC provide enough buffer? Companies at 12-13% ROIC have a 0-1 percentage point margin before falling below cost of capital. Companies at 20%+ can absorb a major acquisition mistake and still create value. Buffer matters more than current level.

2. Is GW/TA below 30%? The cliff effect strengthens above 30% GW/TA and becomes severe above 40%. Companies below 20% GW/TA — Viscofan (1%), ARB Corp (5%), Hoya (4.2%), MT Hojgaard (5%), NKT (8%), OEM International (8%), Watsco (10%), Technology One (10%), Logista (12%) — have structural balance sheet advantages that protect future ROIC regardless of the next acquisition outcome.

3. Is ROIC stable or improving? Declining ROIC trends are the leading indicator of future Tier B reclassification. Companies moving from top to bottom ROIC quintile deliver -11% compound annual TSR over three years, per Mauboussin & Callahan (2023). That destruction happens before the stock fully reflects it. Momentum Group, Lifco, Enghouse Systems, Sonova, and Edenred all show declining trends today.

4. Is the moat structural or cyclical? The most durable Tier A names own structural advantages: Rollins (recurring pest control contracts), Wolters Kluwer (regulatory software that customers cannot stop using), Kone (elevator maintenance installed base), Hoya (medical/optical duopoly), OEM International (organic niche distribution), Logista (tobacco/pharma distribution monopoly with no structural substitute). Cyclical recoveries — Fugro, Wartsila, ISS, NKT — earn above cost of capital today but their ROIC is cycle-dependent. A cycle turn can move them from Tier A to Tier B in a single year.

Methodology

We screened 187 serial acquirers across 14 markets by ROIC with goodwill in the denominator. The 59 companies in this article earned above 12% ROIC as of the latest fiscal year available in February 2026. Data sourced from QuickFS (13 markets) and Stock Analysis (Japan). Drawdowns from Yahoo Finance, maximum from 5-year peak.

Tier A classifications are from our Global Serial Acquirer Scorecard pillar. The sub-tier assignments (Elite/Strong/Fragile) in this article are our analytical layer applied on top of the source data — not changes to underlying data. Companies are assigned by ROIC level: Elite (above 20%), Strong (15-20%), Fragile (12-14.9%). Within each tier, we apply the GW/TA and trend filters described above.

Japan note: four zero-goodwill companies (Nihon M&A Center, Disco, Keyence, MonotaRO) are included in the pillar’s Tier A count. They are organic growers, not serial acquirers in the acquisition-intensive sense. We note this in the Elite tier table. The genuine Japanese acquirer story centers on Hoya, Recruit, and M3.

Dover note: 28.7% ROIC is anomalous relative to prior years (12.5%, 13.7%, 16.0%). We include it in the Elite table for completeness but recommend a normalized ~13% for investment analysis. Dover belongs analytically in the Strong tier.

For full market rankings and the complete 59-company Tier A table: Global Serial Acquirer Scorecard. For the mechanics of goodwill destruction: The Goodwill Cliff. For our cross-market ROIC analysis: Serial Acquirer ROIC Analysis. For the low-goodwill compounding model: Compounding Machines. For how CSU compares globally: Constellation Software vs the World. For the full evaluation framework: How to Analyze a Serial Acquirer.