Do global multi-baggers continue to outperform?

I recently wrote an article as a follow-up to the popular multi-bagger studies, looking at the subsequent performance of the UK multi-baggers. To do this, I used two studies: "The makings of a multi-bagger" by hedge fund Alta Fox in 2020 and, more recently, Stockopedia's 2023 study, which looked at the best-performing UK Stocks over the previous decade.

The key attributes of stocks that generate exceptional performance found by these studies (and others) tend to be the same. I have previously summarised these into my "MROC" framework. Investors should be looking for companies that have moat, runway, operational leverage and are cheap.

Moat

These are companies with a sustainable competitive advantage. This means that competitors have been unable to deploy additional capital to eat into their returns over time. Instead, the company can reinvest capital at high rates to drive sales growth.

Runway

A moat is a great asset for a company, but if there isn't scope to deploy additional capital at very high returns, the business will always remain niche. For investors to receive phenomenal returns, a company requires a significant growth runway ahead.

Operational Leverage

A strong moat and significant sales growth alone can generate excellent profit growth, which may be reflected in...