Why look beyond the United States

The chart below sums up the situation.

The U.S. market trades at around 19 times expected earnings, versus less than 13 times for the rest of the world. Both markets have pulled back in recent months, but the gap has not closed: the U.S. premium still sits at about 50%. That is one of the highest levels in 50 years. For most of the 2000s, the premium ranged between 0% and 20%.

History shows that extreme premiums do not last. In the late 1980s, the situation was reversed. Japan was in the midst of a stock and real estate bubble, and it made up nearly 60% of the non-U.S. index. Japan drove the rest-of-world multiple to almost 28 times earnings while the United States traded at a 50% discount. The bubble burst in 1990. The Nikkei took 34 years to regain its December 1989 peak, which it finally did in 2024.

Today, the epicentre of enthusiasm for artificial intelligence is the United States: massive investment, high valuations and an index dominated by a handful of technology stocks.

A common objection is that the U.S. premium reflects a better sector mix. That is partly true, but the gap persists when you compare similar companies. Bureau Veritas, a global leader in testing, inspection and certification, is a good example. It trades at about 19 times estimated 2026 earnings and 17 times 2027 earnings, compared with nearly 30 times in 2021 and more than 20 times in 2024. Its U.S. peer, UL Solutions, trades at about 30 times expected earnings. Yet both companies show comparable organic growth of about 6% in 2025. In our view, you get comparable quality at a discount of roughly 35%. And that price is low even by Bureau Veritas's own history.

Leaders who think in decades

Outside the United States, far more companies are controlled by a family or a foundation. These anchor shareholders have their own wealth at stake and a horizon that extends well beyond the next quarter. They invest for the long run, keep a solid balance sheet and resist fads. That is exactly the alignment we look for.

Dassault Systèmes, a recent addition to our portfolio, is a fine example. The Dassault family, through Groupe Industriel Marcel Dassault, owns about 40% of this global leader in 3D design software. The family has been building industrial companies for generations. It also controls Dassault Aviation, holding 67% of the shares and 80% of the voting rights.

It is not an isolated case in our portfolio. Bureau Veritas has long had Wendel as its anchor shareholder, and Coloplast is controlled by a foundation tied to its founders. In the United States, executives are more often salaried managers, paid in options tied to short-term targets. Europe and Japan therefore offer a much larger pool of companies run by true owners.

Diversification has become rare

Diversification has never been so useful, because it has never been so rare. Most investors are heavily concentrated in the same large U.S. stocks. Diversifying means reducing your dependence on a single market, a single currency and a single theme. Markets outside the United States offer other advantages as well:

• a larger share of expected returns coming from dividends;

• less exposure to the AI investment cycle;

• mid-sized companies that fewer analysts follow, where fundamental research is better rewarded.

That said, we are not turning our backs on the United States. About a third of the portfolio is invested there, in great franchises such as Visa. We simply find more opportunities elsewhere today.

François and Patrick

Notes and sources

The securities mentioned are for illustration only and do not constitute a recommendation to buy or sell. At the time of publication, portfolios managed by Nordvik Capital hold shares of Bureau Veritas, Dassault Systèmes, Coloplast and Visa.

Forward price-to-earnings ratios for the United States and the rest of the world: The Daily Shot (chart redrawn by Nordvik Capital, approximate values).

Groupe Industriel Marcel Dassault's stake in Dassault Aviation (67.31% of the shares and 80.41% of the voting rights as of September 7, 2026): Dassault Aviation. Wendel has held about 21.4% of the shares and 35% of the voting rights of Bureau Veritas since its September 2025 sale: AWP / allnews.

Price-to-earnings ratios for Bureau Veritas and UL Solutions and 2025 organic growth: company data and consensus estimates, compiled by Nordvik Capital.