Our 3 top value, growth, and quality stocks to watch in the year ahead

There’s a statistic from Roger Federer that I keep coming back to. In a speech to a big Ivy League school, he asked the audience: what do you think my win-loss percentage was for individual points across my entire career?

You’d think one of the greats must be a big number. It’s only 54%.

The point is simple. If you’re playing again and again, consistently, that’s enough to get you exceptional results. 

A top quartile fund manager only gets about 55% of their stock picks right. It’s not a glamorous number. But done repeatedly, it compounds into something powerful.

That consistency is what we obsess over at Plato. Not swinging for the fences. Not concentrating into a handful of high-conviction bets and hoping for the best.

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Investors don't need to pick style lanes

One of the things we don’t believe in is style timing. It’s great in theory, incredibly challenging in practice.

Markets rotate. Value runs for a stretch, then growth takes over, then quality leads. Trying to time those shifts is a recipe for whiplash.

In the Plato Global Alpha Fund we always hold roughly a third of the portfolio in the best of value, a third in the best of growth, and a third in the best of quality. 

That’s the engine behind our all-weather approach – and it’s why the strategy has outperformed in both value-led and growth-led markets since inception.

At different points of market cycle, you often find more opportunities in one bucket vs the others. But right now, we’re finding compelling opportunities across all three.

At the recent 2026 Pinnacle Insights Series event, I shared some of our best investment ideas across the three buckets.

The Plato Global Alpha Fund is a highly diversified long/short portfolio, the following three holdings are discussed to highlight the opportunities that exist across the market, and are names I believe are worth watching closely in the year ahead. 

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Plato Global Alpha Complex ETF (PGA1)

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The value stock to watch: BNP Paribas (EPA: BNB)

If you’re an Australian investor, you know what it’s like to overpay for a bank.

Commonwealth Bank (ASX: CBA) trades at a P/E in the high 20s. It’s a fine institution, but the valuation is extraordinary.

Now broaden the lens. 

BNP Paribas, one of Europe’s largest and most diversified banking franchises, trades on just eight times earnings. It carries a 30% higher net interest margin than our beloved “Magnificent One” – and yet the market treats it as if it barely deserves a seat at the table.

This is the kind of valuation disconnect that defines the current opportunity in European equities. Resilient, global businesses trading at deep discounts to comparable peers, simply because they’re listed on the wrong exchange.

The growth stock to watch: Broadcom (NYSE: AVGO) 

Software names are being absolutely obliterated by fears that AI will disrupt the sector. Semiconductors, by contrast, have held up extremely well – outperforming software by around 60% over the past 12 months.

Within semis, it’s hard to find a better picks-and-shovels play than Broadcom. This is a company that has grown its free cash flow organically at 32% per year over the last decade. That’s not a typo. 32% per year, sustained, for ten years.

As AI infrastructure buildout continues to accelerate, Broadcom sits squarely at the intersection of networking, custom silicon, and enterprise connectivity. 

It’s not a speculative AI bet – it’s a proven cash flow compounder riding a structural tailwind.

The quality stock to watch: Novartis (NYSE: NVS)

It’s always good to have defensive names in your portfolio – companies that tend to hold up when the market is selling off aggressively.

Novartis is exactly that kind of holding. It’s a business at the frontier of targeted cancer therapies, developing radioactive isotopes that are injected into the body and selectively target cancerous tissue. Anyone who’s been through radiation therapy knows how difficult it can be. What Novartis is doing has the potential to transform that experience.

Beyond the innovation story, it’s a defensive anchor. Predictable revenues, strong margins, and the kind of resilience that earns its place in a portfolio when volatility returns. And it always returns.

Generating strong returns is as much about what you avoid as what you own.

Avoiding landmines in portfolios is just as important as picking winners. 

Over more than a decade, the Plato team has built a proprietary toolkit of 150+ red flags – drawn from hundreds of case studies of corporate collapses, accounting frauds, and manipulations going back decades - Wirecard, Enron, Lehman Brothers.

The patterns repeat. Obscure auditors. Special-purpose vehicles. Related party transactions. Senior executives with no skin in the game, or worse, executives selling aggressively into a falling share price. 

When a stock is already down 40% and the board starts selling in unison, the price isn’t coming back. There’s more bad news on the horizon.

The magic number for us is eight or more red flags. On average, a company that triggers eight or more will underperform the market by some 20% over the next 12 months. It’s incredibly powerful – not just for identifying great shorts, but for keeping us away from longs that look cheap for a reason.

Consistency over conviction

Markets reward consistency far more than they reward conviction. The funds that swing for the fences tend to have spectacular runs followed by spectacular drawdowns. That’s not the journey most investors need.

By blending the best of value, growth, and quality – and by rigorously screening out the landmines before they detonate – the Plato Global Alpha Fund aims to deliver a smoother ride without giving up the upside.

Just like Federer. The greats don’t need to hit every shot for six. They just need to keep finding the gaps in the field.

Learn more about the Plato Global Alpha Fund 

Since inception (1 Sept 2021), the Plato Global Alpha Fund has delivered +25.2% p.a. after fees.

You can access the strategy on the ASX via the Plato Global Alpha Fund - Complex ETF (ASX: PGA1) 

• Download the latest Plato Global Alpha Fund monthly report
• Watch David Allen's full presentation from the 2026 Pinnacle Insights Series

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