Constellation Software Inc. (CSU.TO)

These guys buy SaaS as their general business model. Some concerns in Silicon Valley and other places that AI is going to replace a lot of what SaaS can do. That could be a problem for a company like this one. It's been a great play for the past decade.

Going forward, there are some questions with AI that we need to have answered. Not sure that anyone has those answers yet. Stock trades at a pretty significant premium of 40x PE. High risk. Avoid at the moment.

Phenomenal compounder. It's really 6 companies in 6 different operating subsidiaries. Master of the small deal, and that's how it gets such attractive valuations. They buy things that other people don't know to buy. Really a private equity firm that focuses on software. 

If AI disproportionately affected 1 or 2 of its 1000 businesses, that wouldn't take down the ship. Very attractive multiple. Solid growth. High likelihood of multiple expansion. Yield is 0.14%.

Fantastic Canadian tech story. CEO stepped aside on health concerns. Stock was starting to get tired after digesting all those acquisitions, and the CEO announcement was the catalyst for selling.

Take a look at the chart. We didn't want long-term support ~$4400 broken, but it did and went to $3600. Top was $5200. The math works out: 5200-4400=800; and 4400-800=3600. He'd absolutely hold it today for the long term. Buy a bit today, and then be cautious on your remaining position -- see where it goes.

What's happening now is akin to everyone putting a pause on BRK.B when Buffett announced his retirement. Mark Leonard always said it was so important to have smarter people than he around him, and those smarter people are still there. He'd buy here. Chart shows support ~$3500; if it goes under that, something's going on.

Good wishes to Mark Leonard that everything works out well. 

Rolling over a bit here. Part of the trend of capital rotating out of big-cap names. He came out of it in the summer as it started to weaken. Fairly sizable correction in last couple of months, not sure bottomed out yet. Still in downtrend of lower highs. He'd at least want to see it back above $4k.

Technically, you have to use the chart for adding to this one. Software has a bit of a harder time with the AI themes. Still an M&A buildout model in a fragmented space. Good growth. Reasonable multiple. He'd be more a buyer than a seller.

One of the Canadian superstars. Historic PE has always been a little high for him, but the CEO has done a great job buying companies. As for AI, he sees a lot of money going into AI and won't see a lot of revenues for a while. AI can write software, but it takes a lot of skill to put it all together.CSU will continue to exploit this. It's still too pricey for him, but growth investors should consider this.

Probably the best company in Canada over the past 20 years. Everyone had a complete freak out because stock was down 1%. In entire history, it's only been down once on a calendar year. Likes to acquire, but has tight criteria including not overpaying.

Concern that will suffer from AI. But company is not just sitting around. Doesn't do conference calls because track record speaks for itself, but next Wednesday is a conference call to address AI challenges and opportunities. They know what they're doing. And now the stock's cheaper.

Down ~20% from highs (very rare occurrence), and that's the beauty of it. Acquires vertical integration software niche to a particular industry. Notoriously low-key, but holding a conference call September 22 on AI risk/opportunities. Pullbacks in this name are always buyable, as 2 decades have shown. Yield is 0.13%.

We would not rule the company out, certainly. It knows its space and of course its historical record is impressive. It will not just sit around and watch AI. The company plans an update next week which we will attend, to discuss its AI initiatives and opportunities, as well as risks. We would give it a 7/10 for a buy rating right now. There are always risks, but the negative sentiment shift has been greater than the fundamental shift here, at least so far.
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Huge fan. The downturn is a blip and a major buying opportunity. The market misperceives that AI will hurt vertical market software companies. No, it's the complete opposite whereby these companies will benefit from AI a lot. You can't displace these companies easily. We will see serious margin expansion and an uptick in innovation.

Quite volatile chart, but you can deal with that if you have it in the right (low, perhaps 1.5-3%) weighting in your portfolio. He'd definitely step in again today, as it hasn't participated in the recent rally.

He entered at $1,000, so is pleased. Software is a good business--don't need business or computers, just the code. The valuation remains cheap. Good management and fundamentals. He see many years of acquisition growth. Is a core holding.

Loves the business model. Management is phenomenal. Concern is valuation at high 20s free cashflow multiple, which implies earnings yield to shareholder of 3% and change. Based on its size, how many more acquisitions can it make to move the needle? As a value manager, hard for him to buy.