What makes a company a monopoly or "the only game in town"?

A company becomes "the only game in town" when it dominates its market with little to no meaningful competition. This can happen through various means: building an extensive network that's difficult to replicate (like Google's search engine), owning essential patents (like pharmaceutical companies), having overwhelming brand recognition (like Coca-Cola), or operating in industries with high barriers to entry. These companies typically control a large percentage of market share—often over 70%—and can influence pricing and industry standards.

Why are monopolistic companies considered good investments?

Companies with monopolistic positions often make attractive investments because they tend to have predictable revenue streams, strong pricing power, and high profit margins. With limited competition, they don't need to engage in price wars that hurt profitability. They typically generate steady cash flows that can fund dividends, buybacks, or growth initiatives. Their dominant market positions also provide some resilience during economic downturns. However, these advantages must be balanced against regulatory risks, as governments worldwide increasingly scrutinize market-dominating companies.

What are "moats" in business and investing?

In investing, a "moat" refers to a company's ability to maintain competitive advantages over its rivals, protecting its market share and profitability—similar to how castle moats protected against invaders. Strong moats can include brand loyalty (like Coca-Cola), network effects (like Google), high switching costs (where changing to a competitor is difficult), cost advantages from scale, or legal protections like patents. Companies with wide moats can typically sustain their dominant position and profitability for longer periods, making them potentially more valuable long-term investments.

What regulatory risks do monopolistic companies face?

Dominant companies face increasing regulatory scrutiny around the world. These risks include potential antitrust investigations that could force company breakups, significant fines for anti-competitive behavior, restrictions on mergers and acquisitions, and regulations that limit how they can operate or price their products. In recent years, tech giants especially have faced growing regulatory pressure in the US, EU, and other markets. These regulatory actions can materially impact a company's business model, growth prospects, and profitability, creating uncertainty for investors.

How do dividend yields relate to dominant market companies?

Dividend yield is the annual dividend payment divided by the stock price, expressed as a percentage. Many market-dominant companies offer attractive dividend yields because their established positions and lack of significant competition often result in stable, predictable cash flows. With less need to reinvest heavily to fend off competitors, these companies can return more capital to shareholders through dividends. Companies like tobacco firms (MO) and consumer staples businesses (PG, KO) on this list are known for their reliable, often growing dividend payments, making them popular among income-focused investors.

15 handpicked stocks

Only Game In Town

These companies have achieved such dominance that they face little to no real competition in their markets. Our analysts have carefully selected businesses with unmatched market power, creating stability and sustained profitability that comes from being the only real choice in their sectors.

Han Tan | Market Analyst

Published on June 20

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

Alphabet Inc. - Class C Shares

GOOG

Current price

$246.73

Its search engine holds an insurmountable market share, creating a powerful data and network effect moat in digital advertising.

Coca-Cola Company, The

Current price

$66.00

Features an unparalleled global brand and distribution network, solidifying its leadership in the non-alcoholic beverage space.

Berkshire Hathaway Inc.

BRK.A

Current price

$744,627.72

Represents a collection of diverse businesses, many of which possess monopolistic characteristics in sectors like insurance and freight rail.

Altria Group Inc.

Current price

$65.75

Procter & Gamble Company, The

Current price

$152.21

Merck & Co. Inc.

MRK

Current price

$89.51

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12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

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In 12 months it might be worth:

$1,000.00

+6.70%

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About This Group of Stocks

Our Expert Thinking

We've identified companies that enjoy near-monopolistic power in their respective industries. These businesses provide essential products or services with high barriers to entry, allowing them to maintain pricing power and generate predictable cash flows. Their dominant market positions make them resilient investments.

What You Need to Know

These stocks can act as a stabilizing core in your portfolio, offering consistent growth even in challenging markets. While their market dominance provides strength, be aware of increasing regulatory scrutiny that monopolistic businesses face globally. Their entrenched positions typically weather economic cycles well.

Why These Stocks

Each company was selected for its overwhelming market share and defensible competitive advantages. They operate in industries where few, if any, direct competitors exist. Many leverage proprietary technology, brand identity, or operational scale to create insurmountable barriers for potential challengers.

Group Performance Snapshot

6.73%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 6.73% over the next year.

11 of 15

Stocks Rated Buy by Analysts

11 of 15 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks1

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Kings of Their Castles

These companies aren't just leaders—they rule their markets with virtually no challengers. Their entrenched dominance means they can set prices and enjoy customer loyalty that competitors can only dream about.

💰

Cash Flow Machines

With little competitive pressure, these companies generate predictable, steady cash flows that translate to stable returns and often generous dividends. They're the reliable performers in a portfolio during market turbulence.

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Built-In Defense Systems

Market monopolies don't happen by accident. These companies have created moats so wide—through patents, network effects, or scale—that new competitors struggle to gain even a foothold in their territory.

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