Constellation Software (TSE:CSU)
TSX:CSU
Want to see TSE:CSU full AI Analyst Report?
Top Page
Constellation Software
(TSX:CSU)
Select Model
Select Model
Rating:60Neutral
Price Target:
C$2,410.00
▼(-8.24% Downside)
Action:ReiteratedDate:03/12/26
The score is driven primarily by strong financial performance on cash flow generation and solid operating profitability, partially offset by slower 2025 growth, compressed net margins, and notable leverage. Technicals are mixed with longer-term weakness, and valuation is a key headwind due to the very high P/E and low yield.
Positive Factors
Free Cash Flow Generation
Very high cash conversion (FCF ≈97% of net income) is a durable strength: it underpins repeatable funding for acquisitions, product reinvestment, and shareholder returns without relying on equity markets. Over a 2–6 month horizon this supports stable operations and strategic optionality.
Negative Factors
Elevated leverage
Relatively high leverage (~1.6x debt/equity) reduces balance-sheet flexibility and increases sensitivity to interest costs and refinancing risk. This structural capital structure constraint can limit the pace of opportunistic M&A or require prioritization of debt service over growth in the coming months.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow Generation
Very high cash conversion (FCF ≈97% of net income) is a durable strength: it underpins repeatable funding for acquisitions, product reinvestment, and shareholder returns without relying on equity markets. Over a 2–6 month horizon this supports stable operations and strategic optionality.
Read all positive factors
Constellation Software (CSU) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$51.75B
Dividend Yield0.17%
Average Volume (3M)66.01K
Price to Earnings (P/E)97.8
Beta (1Y)0.97
Revenue Growth17.69%
EPS Growth-31.66%
CountryCA
Employees45,000
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)24.86
Shares Outstanding21,191,530
10 Day Avg. Volume56,132
30 Day Avg. Volume66,014
Financial Highlights & Ratios
PEG Ratio-3.40
Price to Book (P/B)14.28
Price to Sales (P/S)4.31
P/FCF Ratio19.84
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$4,243.33Price Target Upside61.56% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)116.72
Revenue Forecast (FY)C$13.60B
Constellation Software Business Overview & Revenue Model
Company Description
Constellation Software Inc., together with its subsidiaries, acquires, builds, and manages vertical market software businesses in Canada, the United States, the United Kingdom, and rest of Europe. Its industry specific software businesses provide ...
How the Company Makes Money
Constellation Software makes money primarily by acquiring vertical market software companies and operating them for long-term cash flow. Its key revenue streams typically include: (1) Recurring software revenue from maintenance and support contrac...
Constellation Software Financial Statement Overview
Summary
Income Statement
76
Positive
Balance Sheet
62
Positive
Cash Flow
81
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 11.83B | 10.07B | 8.41B | 6.62B | 5.11B |
| Gross Profit | 4.68B | 3.62B | 2.95B | 2.32B | 1.88B |
| EBITDA | 3.34B | 1.97B | 1.60B | 1.25B | 1.11B |
| Net Income | 520.96M | 731.00M | 565.00M | 512.00M | 310.00M |
Balance Sheet | |||||
| Total Assets | 16.14B | 12.86B | 10.78B | 7.95B | 5.71B |
| Cash, Cash Equivalents and Short-Term Investments | 3.14B | 1.99B | 1.29B | 935.08M | 794.46M |
| Total Debt | 5.78B | 4.53B | 4.46B | 2.31B | 1.38B |
| Total Liabilities | 11.88B | 9.57B | 8.84B | 6.00B | 4.21B |
| Stockholders Equity | 3.57B | 2.79B | 1.86B | 1.73B | 1.05B |
Cash Flow | |||||
| Free Cash Flow | 2.57B | 1.89B | 1.63B | 1.15B | 1.22B |
| Operating Cash Flow | 2.64B | 1.95B | 1.68B | 1.19B | 1.24B |
| Investing Cash Flow | -1.97B | -1.52B | -1.67B | -1.65B | -1.22B |
| Financing Cash Flow | 358.16M | 277.98M | 456.28M | 540.42M | -983.21K |
Constellation Software Technical Analysis
Neutral
2626.45
Price Trends
2508.13
Positive
2809.03
Negative
3514.85
Negative
Market Momentum
2.37
Negative
58.46
Neutral
82.75
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CSU, the sentiment is Neutral. The current price of 2626.45 is above the 20-day moving average (MA) of 2453.76, above the 50-day MA of 2508.13, and below the 200-day MA of 3514.85, indicating a neutral trend. The MACD of 2.37 indicates Negative momentum. The RSI at 58.46 is Neutral, neither overbought nor oversold. The STOCH value of 82.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:CSU.
Constellation Software Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | C$947.73M | 14.62 | 12.17% | 5.69% | -2.18% | -18.24% | |
71 Outperform | C$8.56B | 38.38 | 10.76% | ― | 13.08% | 14.82% | |
69 Neutral | C$4.00B | 49.33 | 16.46% | ― | 15.72% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | C$51.75B | 97.79 | 15.35% | 0.17% | 17.69% | -31.66% | |
59 Neutral | C$7.90B | 12.20 | 10.88% | 3.27% | -2.34% | -29.40% | |
56 Neutral | C$1.74B | -12.26 | -44.56% | ― | 14.98% | -500.11% |
* Technology Sector Average
TSE:CSU
Constellation Software
2,441.95
-2,544.48
-51.03%
TSE:OTEX
Open Text
31.51
-4.17
-11.68%
TSE:DSG
The Descartes Systems Group
99.45
-49.26
-33.12%
TSE:KXS
Kinaxis Inc
144.74
-43.38
-23.06%
TSE:ENGH
Enghouse Systems
17.39
-6.55
-27.37%
TSE:LSPD
Lightspeed POS Inc
12.69
-0.66
-4.94%
Constellation Software Corporate Events
Business Operations and StrategyShareholder Meetings
Constellation Software, Topicus and Lumine Set Joint Hybrid AGMs and Q&A for May 15
Positive
Apr 10, 2026
Constellation Software, along with affiliates Topicus.com and Lumine Group, will hold their annual shareholder meetings on May 15, 2026 in Toronto using a hybrid in-person and webcast format. Topicus will convene at 8:00 a.m. ET, Lumine at 8:15 a....
Business Operations and StrategyExecutive/Board Changes
Constellation Founder Mark Leonard to Step Down From Board, Remain Advisor
Neutral
Mar 28, 2026
Constellation Software announced that founder and former president Mark Leonard will not stand for re-election to the board of directors, with his term ending after the May 15, 2026 annual shareholders’ meeting. Leonard will remain closely i...
Business Operations and StrategyDividendsFinancial Disclosures
Constellation Software Grows Revenue and Cash Flow as Earnings Decline Amid Heavy Deal Activity
Neutral
Mar 9, 2026
Constellation Software reported strong top‑line momentum for the fourth quarter and full year 2025, with revenue up 18% in Q4 and 15% for the year, driven largely by acquisitions and mid‑single‑digit organic growth. Despite this,...
Business Operations and StrategyFinancial Disclosures
Constellation Software Moves Fourth-Quarter Earnings Call to March 9
Neutral
Feb 20, 2026
Constellation Software Inc. has rescheduled its fourth-quarter results conference call, moving it from March 10 to March 9, 2026, and shifting the start time to 8:30 a.m. Eastern. The company will release its quarterly earnings earlier that mornin...
Business Operations and StrategyFinancial Disclosures
Constellation Software Sets March 10 Call on Fourth-Quarter Results
Neutral
Feb 18, 2026
Constellation Software Inc. will release its fourth-quarter results after the Toronto Stock Exchange closes on March 9, 2026, and will host a conference call and live audio webcast the following morning at 8:00 a.m. ET. Senior executives, includin...
Business Operations and StrategyM&A Transactions
Lumine Group Closes Acquisition of Cloud Software Firm Synchronoss Technologies
Positive
Feb 13, 2026
Lumine Group has completed its acquisition of Synchronoss Technologies through a wholly owned subsidiary, adding a leading personal cloud and SaaS platform provider for global telecom operators to its communications and media software portfolio. T...
Business Operations and StrategyPrivate Placements and Financing
Constellation Software Sets 2026 Interest Rate for Series 1 Debentures at 8.6%
Neutral
Jan 19, 2026
Constellation Software Inc. has announced that the annual interest rate on its unsecured subordinated floating rate Series 1 debentures will be reset to 8.6% per annum effective March 31, 2026, based on the annual average change in Canada’s ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.