CONSTELLATION SOFTWARE INC (CSU.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:CSU - CA21037X1006 - Common Stock
3239.07 CAD
-62.33 (-1.89%)
Taking everything into account, CSU scores 6 out of 10 in our fundamental rating. CSU was compared to 64 industry peers in the Software industry. CSU has an excellent profitability rating, but there are some minor concerns on its financial health. CSU is growing strongly while it is still valued neutral. This is a good combination! These ratings could make CSU a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
In the past year CSU was profitable.
CSU had a positive operating cash flow in the past year.
In the past 5 years CSU has always been profitable.
In the past 5 years CSU always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of CSU (4.35%) is better than 79.69% of its industry peers.
The Return On Equity of CSU (19.20%) is better than 89.06% of its industry peers.
CSU's Return On Invested Capital of 9.25% is fine compared to the rest of the industry. CSU outperforms 78.13% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CSU is below the industry average of 12.19%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.35% | ||
| ROE | 19.2% | ||
| ROIC | 9.25% |
ROA(3y)5.8%
ROA(5y)6.55%
ROE(3y)28.73%
ROE(5y)31.4%
ROIC(3y)10.12%
ROIC(5y)11.52%
1.3 Margins
Looking at the Profit Margin, with a value of 5.97%, CSU is in the better half of the industry, outperforming 79.69% of the companies in the same industry.
In the last couple of years the Profit Margin of CSU has declined.
CSU's Operating Margin of 16.15% is amongst the best of the industry. CSU outperforms 85.94% of its industry peers.
CSU's Operating Margin has been stable in the last couple of years.
CSU has a better Gross Margin (98.30%) than 98.44% of its industry peers.
CSU's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.15% | ||
| PM (TTM) | 5.97% | ||
| GM | 98.3% |
OM growth 3Y-4.63%
OM growth 5Y-0.13%
PM growth 3Y6.15%
PM growth 5Y-5.31%
GM growth 3Y0.09%
GM growth 5Y0.25%
2. Health
2.1 Basic Checks
CSU has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, CSU has about the same amount of shares outstanding.
Compared to 5 years ago, CSU has about the same amount of shares outstanding.
CSU has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.01 indicates that CSU is not in any danger for bankruptcy at the moment.
CSU has a Altman-Z score of 4.01. This is in the better half of the industry: CSU outperforms 71.88% of its industry peers.
CSU has a debt to FCF ratio of 2.13. This is a good value and a sign of high solvency as CSU would need 2.13 years to pay back of all of its debts.
The Debt to FCF ratio of CSU (2.13) is better than 76.56% of its industry peers.
CSU has a Debt/Equity ratio of 1.20. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.20, CSU is doing worse than 62.50% of the companies in the same industry.
Although CSU does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 2.13 | ||
| Altman-Z | 4.01 |
ROIC/WACC0.94
WACC9.83%
2.3 Liquidity
CSU has a Current Ratio of 1.02. This is a normal value and indicates that CSU is financially healthy and should not expect problems in meeting its short term obligations.
CSU's Current ratio of 1.02 is in line compared to the rest of the industry. CSU outperforms 40.63% of its industry peers.
A Quick Ratio of 1.00 indicates that CSU should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.00, CSU perfoms like the industry average, outperforming 40.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 1 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 35.60% over the past year.
CSU shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 24.67% yearly.
The Revenue has grown by 15.10% in the past year. This is quite good.
The Revenue has been growing by 23.60% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)35.6%
EPS 3Y24.73%
EPS 5Y24.67%
EPS Q2Q%24.27%
Revenue 1Y (TTM)15.1%
Revenue growth 3Y25.39%
Revenue growth 5Y23.6%
Sales Q2Q%15.98%
3.2 Future
CSU is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.00% yearly.
Based on estimates for the next years, CSU will show a quite strong growth in Revenue. The Revenue will grow by 15.69% on average per year.
EPS Next Y17.03%
EPS Next 2Y17.03%
EPS Next 3Y18%
EPS Next 5YN/A
Revenue Next Year15.23%
Revenue Next 2Y16.05%
Revenue Next 3Y16.26%
Revenue Next 5Y15.69%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 24.12, CSU is valued on the expensive side.
CSU's Price/Earnings ratio is rather cheap when compared to the industry. CSU is cheaper than 84.38% of the companies in the same industry.
CSU's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.60.
The Price/Forward Earnings ratio is 20.09, which indicates a rather expensive current valuation of CSU.
CSU's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CSU is cheaper than 76.56% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CSU to the average of the S&P500 Index (23.23), we can say CSU is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.12 | ||
| Fwd PE | 20.09 |
4.2 Price Multiples
CSU's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CSU is cheaper than 73.44% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CSU indicates a rather cheap valuation: CSU is cheaper than 81.25% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.64 | ||
| EV/EBITDA | 17.13 |
4.3 Compensation for Growth
CSU's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of CSU may justify a higher PE ratio.
A more expensive valuation may be justified as CSU's earnings are expected to grow with 18.00% in the coming years.
PEG (NY)1.42
PEG (5Y)0.98
EPS Next 2Y17.03%
EPS Next 3Y18%
5. Dividend
5.1 Amount
CSU has a yearly dividend return of 0.17%, which is pretty low.
Compared to an average industry Dividend Yield of 0.20, CSU pays a better dividend. On top of this CSU pays more dividend than 90.63% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.00, CSU's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.17% |
5.2 History
The dividend of CSU decreases each year by -30.09%.
CSU has been paying a dividend for at least 10 years, so it has a reliable track record.
CSU has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-30.09%
Div Incr Years0
Div Non Decr Years17
5.3 Sustainability
12.76% of the earnings are spent on dividend by CSU. This is a low number and sustainable payout ratio.
DP12.76%
EPS Next 2Y17.03%
EPS Next 3Y18%
TSX:CSU (1/2/2026, 7:00:00 PM)
3239.07
-62.33 (-1.89%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners40.3%
Inst Owner ChangeN/A
Ins Owners2.27%
Ins Owner ChangeN/A
Market Cap68.64B
Revenue(TTM)11.15B
Net Income(TTM)666.00M
Analysts78.75
Price Target5070.79 (56.55%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.17% |
Yearly Dividend5.49
Dividend Growth(5Y)-30.09%
DP12.76%
Div Incr Years0
Div Non Decr Years17
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.33%
Min EPS beat(2)6.89%
Max EPS beat(2)13.77%
EPS beat(4)3
Avg EPS beat(4)6.01%
Min EPS beat(4)-22.05%
Max EPS beat(4)25.45%
EPS beat(8)4
Avg EPS beat(8)-0.2%
EPS beat(12)7
Avg EPS beat(12)3.79%
EPS beat(16)10
Avg EPS beat(16)5.24%
Revenue beat(2)0
Avg Revenue beat(2)-1.7%
Min Revenue beat(2)-1.76%
Max Revenue beat(2)-1.64%
Revenue beat(4)0
Avg Revenue beat(4)-2.54%
Min Revenue beat(4)-4.77%
Max Revenue beat(4)-1.64%
Revenue beat(8)1
Avg Revenue beat(8)-1.64%
Revenue beat(12)3
Avg Revenue beat(12)-1.17%
Revenue beat(16)3
Avg Revenue beat(16)-1.03%
PT rev (1m)-0.98%
PT rev (3m)-10.95%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.29%
EPS NY rev (1m)7.14%
EPS NY rev (3m)7.34%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.96%
Revenue NY rev (1m)-0.77%
Revenue NY rev (3m)-0.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.12 | ||
| Fwd PE | 20.09 | ||
| P/S | 4.5 | ||
| P/FCF | 19.64 | ||
| P/OCF | 19.1 | ||
| P/B | 14.45 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.13 |
EPS(TTM)134.3
EY4.15%
EPS(NY)161.19
Fwd EY4.98%
FCF(TTM)164.9
FCFY5.09%
OCF(TTM)169.55
OCFY5.23%
SpS720.39
BVpS224.15
TBVpS-295.68
PEG (NY)1.42
PEG (5Y)0.98
Graham Number823
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.35% | ||
| ROE | 19.2% | ||
| ROCE | 18.7% | ||
| ROIC | 9.25% | ||
| ROICexc | 13.04% | ||
| ROICexgc | N/A | ||
| OM | 16.15% | ||
| PM (TTM) | 5.97% | ||
| GM | 98.3% | ||
| FCFM | 22.89% |
ROA(3y)5.8%
ROA(5y)6.55%
ROE(3y)28.73%
ROE(5y)31.4%
ROIC(3y)10.12%
ROIC(5y)11.52%
ROICexc(3y)13.25%
ROICexc(5y)15.63%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)20.46%
ROCE(5y)23.3%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y-11.6%
ROICexc growth 5Y-7.15%
OM growth 3Y-4.63%
OM growth 5Y-0.13%
PM growth 3Y6.15%
PM growth 5Y-5.31%
GM growth 3Y0.09%
GM growth 5Y0.25%
F-Score5
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 2.13 | ||
| Debt/EBITDA | 1.33 | ||
| Cap/Depr | 5.4% | ||
| Cap/Sales | 0.65% | ||
| Interest Coverage | 8.74 | ||
| Cash Conversion | 83.73% | ||
| Profit Quality | 383.18% | ||
| Current Ratio | 1.02 | ||
| Quick Ratio | 1 | ||
| Altman-Z | 4.01 |
F-Score5
WACC9.83%
ROIC/WACC0.94
Cap/Depr(3y)4.86%
Cap/Depr(5y)4.81%
Cap/Sales(3y)0.59%
Cap/Sales(5y)0.6%
Profit Quality(3y)281.44%
Profit Quality(5y)304.12%
High Growth Momentum
Growth
EPS 1Y (TTM)35.6%
EPS 3Y24.73%
EPS 5Y24.67%
EPS Q2Q%24.27%
EPS Next Y17.03%
EPS Next 2Y17.03%
EPS Next 3Y18%
EPS Next 5YN/A
Revenue 1Y (TTM)15.1%
Revenue growth 3Y25.39%
Revenue growth 5Y23.6%
Sales Q2Q%15.98%
Revenue Next Year15.23%
Revenue Next 2Y16.05%
Revenue Next 3Y16.26%
Revenue Next 5Y15.69%
EBIT growth 1Y30.04%
EBIT growth 3Y19.59%
EBIT growth 5Y23.43%
EBIT Next Year146.07%
EBIT Next 3Y50.21%
EBIT Next 5Y38.21%
FCF growth 1Y57.05%
FCF growth 3Y18.78%
FCF growth 5Y23.82%
OCF growth 1Y57.31%
OCF growth 3Y19.11%
OCF growth 5Y23.46%
CONSTELLATION SOFTWARE INC / CSU.CA FAQ
What is the fundamental rating for CSU stock?
ChartMill assigns a fundamental rating of 6 / 10 to CSU.CA.
What is the valuation status of CONSTELLATION SOFTWARE INC (CSU.CA) stock?
ChartMill assigns a valuation rating of 5 / 10 to CONSTELLATION SOFTWARE INC (CSU.CA). This can be considered as Fairly Valued.
How profitable is CONSTELLATION SOFTWARE INC (CSU.CA) stock?
CONSTELLATION SOFTWARE INC (CSU.CA) has a profitability rating of 7 / 10.
How financially healthy is CONSTELLATION SOFTWARE INC?
The financial health rating of CONSTELLATION SOFTWARE INC (CSU.CA) is 5 / 10.
What is the expected EPS growth for CONSTELLATION SOFTWARE INC (CSU.CA) stock?
The Earnings per Share (EPS) of CONSTELLATION SOFTWARE INC (CSU.CA) is expected to grow by 17.03% in the next year.