CONSTELLATION SOFTWARE INC (CSU.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:CSU - CA21037X1006 - Common Stock
3375.08 CAD
+49.5 (+1.49%)
CSU gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 66 industry peers in the Software industry. CSU has an excellent profitability rating, but there are some minor concerns on its financial health. CSU is not priced too expensively while it is growing strongly. Keep and eye on this one! This makes CSU very considerable for growth investing!
1. Profitability
1.1 Basic Checks
In the past year CSU was profitable.
In the past year CSU had a positive cash flow from operations.
Each year in the past 5 years CSU has been profitable.
Each year in the past 5 years CSU had a positive operating cash flow.
1.2 Ratios
CSU's Return On Assets of 4.35% is fine compared to the rest of the industry. CSU outperforms 78.79% of its industry peers.
CSU has a Return On Equity of 19.20%. This is amongst the best in the industry. CSU outperforms 87.88% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.25%, CSU is in the better half of the industry, outperforming 78.79% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CSU is in line with the industry average of 11.66%.
| 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
The Profit Margin of CSU (5.97%) is better than 78.79% of its industry peers.
CSU's Profit Margin has declined in the last couple of years.
The Operating Margin of CSU (16.15%) is better than 84.85% of its industry peers.
CSU's Operating Margin has been stable in the last couple of years.
CSU's Gross Margin of 98.30% is amongst the best of the industry. CSU outperforms 98.48% 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CSU 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
CSU has an Altman-Z score of 4.04. This indicates that CSU is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.04, CSU is doing good in the industry, outperforming 69.70% of the companies in the same industry.
The Debt to FCF ratio of CSU is 2.13, which is a good value as it means it would take CSU, 2.13 years of fcf income to pay off all of its debts.
CSU has a Debt to FCF ratio of 2.13. This is in the better half of the industry: CSU outperforms 75.76% of its industry peers.
A Debt/Equity ratio of 1.20 is on the high side and indicates that CSU has dependencies on debt financing.
With a Debt to Equity ratio value of 1.20, CSU is not doing good in the industry: 63.64% of the companies in the same industry are doing better.
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 | 4.04 |
ROIC/WACC0.96
WACC9.63%
2.3 Liquidity
A Current Ratio of 1.02 indicates that CSU should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.02, CSU is doing worse than 60.61% of the companies in the same industry.
CSU has a Quick Ratio of 1.00. This is a normal value and indicates that CSU is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of CSU (1.00) is worse than 60.61% of its industry peers.
| 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.
CSU shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 15.10%.
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.
CSU is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.69% yearly.
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
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.95, which indicates a rather expensive current valuation of CSU.
CSU's Price/Earnings ratio is rather cheap when compared to the industry. CSU is cheaper than 84.85% of the companies in the same industry.
CSU's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.38.
A Price/Forward Earnings ratio of 20.78 indicates a rather expensive valuation of CSU.
Based on the Price/Forward Earnings ratio, CSU is valued a bit cheaper than 74.24% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.83. CSU is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.95 | ||
| Fwd PE | 20.78 |
4.2 Price Multiples
CSU's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CSU is cheaper than 71.21% of the companies in the same industry.
CSU's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CSU is cheaper than 78.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.32 | ||
| EV/EBITDA | 17.37 |
4.3 Compensation for Growth
The 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)1.47
PEG (5Y)1.01
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.
The stock price of CSU dropped by -23.59% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 0.23, CSU pays a better dividend. On top of this CSU pays more dividend than 89.39% of the companies listed in the same industry.
With a Dividend Yield of 0.17, CSU pays less dividend than the S&P500 average, which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.17% |
5.2 History
The dividend of CSU decreases each year by -30.09%.
CSU has paid a dividend for at least 10 years, which is 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
CSU pays out 12.76% of its income as dividend. This is a sustainable payout ratio.
DP12.76%
EPS Next 2Y17.03%
EPS Next 3Y18%
TSX:CSU (12/19/2025, 7:00:00 PM)
3375.08
+49.5 (+1.49%)
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 Cap71.52B
Revenue(TTM)11.15B
Net Income(TTM)666.00M
Analysts78.75
Price Target5091.19 (50.85%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.17% |
Yearly Dividend5.53
Dividend Growth(5Y)-30.09%
DP12.76%
Div Incr Years0
Div Non Decr Years17
Ex-Date
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)-8.96%
PT rev (3m)-10.59%
EPS NQ rev (1m)0.53%
EPS NQ rev (3m)-0.29%
EPS NY rev (1m)7.14%
EPS NY rev (3m)7.34%
Revenue NQ rev (1m)0.25%
Revenue NQ rev (3m)-0.96%
Revenue NY rev (1m)-0.77%
Revenue NY rev (3m)-0.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.95 | ||
| Fwd PE | 20.78 | ||
| P/S | 4.65 | ||
| P/FCF | 20.32 | ||
| P/OCF | 19.76 | ||
| P/B | 14.95 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.37 |
EPS(TTM)135.3
EY4.01%
EPS(NY)162.39
Fwd EY4.81%
FCF(TTM)166.12
FCFY4.92%
OCF(TTM)170.81
OCFY5.06%
SpS725.74
BVpS225.81
TBVpS-297.87
PEG (NY)1.47
PEG (5Y)1.01
Graham Number829.12
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 | 4.04 |
F-Score5
WACC9.63%
ROIC/WACC0.96
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 for CSU 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.
What are the PE and PB ratios of CONSTELLATION SOFTWARE INC (CSU.CA) stock?
The Price/Earnings (PE) ratio for CONSTELLATION SOFTWARE INC (CSU.CA) is 24.95 and the Price/Book (PB) ratio is 14.95.
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.