Constellation Software Inc. (CSU.TO) Buy,…

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Constellation Software Inc. (CSU.TO)

3,041.21

-34.68 (1.13%)

as of Aug 21, 2026, 8:00:00 pm Market Open.

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Investor Insights

Aug 23, 2026, 12:00 am

This summary was created by AI, based on 87 opinions in the last 12 months.

Constellation Software Inc. (CSU) has generated mixed reviews from experts, reflecting a blend of optimism and caution. Many recognize the company's strong track record of acquiring software businesses and its ability to generate stable cash flows. Despite its impressive history, concerns about the impact of AI and a recent CEO transition have led to a bearish sentiment among some analysts. Several experts noted that while the stock has experienced significant declines, it now presents a potential buying opportunity, especially for long-term investors. However, the varying opinions on its valuation and growth prospects indicate uncertainty about its future performance amidst evolving market dynamics.

Consensus

Cautious

Valuation

Undervalued

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SAP, SAP

DON'T BUY

Likes it. A top pick in the past. Has done very well but it is no longer cheap. As expensive as Microsoft. Likes Topicus a lot. Would not chase CSU at these levels.

PAST TOP PICK

(A Top Pick Jul 06/20, Up 35%) Canadians should be really proud of this one. It stacks up with the best. Extremely well run. Founder is still involved. Doesn't spend a lot of money. Not a lot of debt. High and consistent ROIC. Doesn't issue shares. His largest position.

COMMENT

SHOP vs. Constellation Software E-commerce continues to proliferate our economy, and SHOP grows organically. In contrast, CSU is more of a growth-by-acquisition story, buying software companies to grow in size. Therefore, CSU is safer, but SHOP has much better growth prospects. SHOP recently did a deal with Facebook. SHOP and CSU are apples vs. oranges. SHOP has more pricing power in the stock than people think as they gain market share, but he isn't sure about this with CSU. CSU has great managers and acquire well.

BUY ON WEAKNESS

A wonderful software company. They focus on buying smaller companies. They are disciplined and buy a lot of companies and integrate them well. They compound capital very well over time. Loves it. The only caveat is its high valuation. They tend to have lumpy quarters, disappoint shareholders, so that is the moment to swoop in and buy. Because it has bought so many companies, it doesn't offer a dominant software, so it's not vulnerable if something happens to a particular software.

HOLD

Business model is great, scalable, and repeatable. Disciplined process for capital investment. With high tech valuations, he was scared off by the growth by acquisition model, but shouldn't have been. A good long-term hold.

PAST TOP PICK

(A Top Pick Jul 06/20, Up 13%) The best capital-allocating managers in the world anywhere. A Canadian gem. Still holds and likes it.

TOP PICK

Always a top pick for him. Hold these types of companies for a long, long time and add on weakness, like now. (Analysts’ price target is $1997.50)

COMMENT

Lots of Canadians seem to pour money into Constellation Software but for him, there is no real strategy. For Open Text there is a taxation issue with the IRS and also they need another acquisition. For an acquisition and control point of view, although CSU has outperformed, he thinks OTEX is the better choice. Has OTEX stocks and would buy at these levels.

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PAST TOP PICK

(A Top Pick Apr 15/20, Up 48%) At the time, even with the expensive price, price to growth perspective was good. Acquisitions are going well. It is getting a little rich at 37x 2022. Still holds it but there are better tech names to put new capital to work.

BUY

One of the few companies in the world that respects shareholders and employees. Loves the company. A core holding. Excited about the spinoff Topicus. They're going to put more cash to work as they see opportunities. Fine over the long term.

BUY ON WEAKNESS

Fabulously run. Acquisition strategy. A 10-year ROIC of 32%. Price target of $1800, so not much runway left. Buy on a pullback between $1550-1600. Just be patient.

BUY

They have shown they can consistently grow. He would combine it with SHOP-T as well in his TFSA portfolio.

BUY ON WEAKNESS

CSU-T incl. TOI-T. They acquire other software companies. He thinks TOI-T, which CSU-T spun out, may outperform CSU-T over time. He kept TOI-T and thought he might add to it, but it is a bit expensive right now. If you have a five or ten year horizon you would do well owning either one.

TOP PICK

Management willing to do interesting things to increase shareholder value. This is a team you can trust to reinvest your capital. Next few years will still be really bright. Yield is 0.30%. (Analysts’ price target is $1793.13)

PAST TOP PICK

(A Top Pick Jan 20/20, Up 20%) He bought more in the fall 2020 after a brief stumble around $1,400. It's run by one of the top 10 management teams in the world. They boast free cash flow return on invested capital (after all expenses) is an astonishing 59%, and have a free cash flow of 23%. They've increased their cash flow by 30% average over recent decades. Free cash flow yield now is over 4%. Tremendous value. CSU is his largest position. Eager to see how their Feb. 1 spin out will do.

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Summer Sale

Constellation Software Inc. (CSU.TO)