CONSTELLATION SOFTWARE INC (CSU.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:CSU - CA21037X1006 - Common Stock
3316.17 CAD
-15.15 (-0.45%)
We assign a fundamental rating of 6 out of 10 to CSU. 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 not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make CSU a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
CSU had positive earnings in the past year.
In the past year CSU had a positive cash flow from operations.
Each year in the past 5 years CSU has been profitable.
CSU had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
CSU's Return On Assets of 4.35% is fine compared to the rest of the industry. CSU outperforms 78.13% of its industry peers.
The Return On Equity of CSU (19.20%) is better than 87.50% of its industry peers.
CSU has a Return On Invested Capital of 9.25%. This is in the better half of the industry: CSU outperforms 78.13% of its industry peers.
CSU had an Average Return On Invested Capital over the past 3 years of 10.12%. This 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
The Profit Margin of CSU (5.97%) is better than 78.13% of its industry peers.
In the last couple of years the Profit Margin of CSU has declined.
CSU has a Operating Margin of 16.15%. This is amongst the best in the industry. CSU outperforms 85.94% of its industry peers.
In the last couple of years the Operating Margin of CSU has remained more or less at the same level.
With an excellent Gross Margin value of 98.30%, CSU belongs to the best of the industry, outperforming 98.44% of the companies in the same industry.
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CSU is still creating some value.
Compared to 1 year ago, CSU has about the same amount of shares outstanding.
CSU has about the same amout of shares outstanding than it did 5 years ago.
The debt/assets ratio for CSU is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.02 indicates that CSU is not in any danger for bankruptcy at the moment.
CSU's Altman-Z score of 4.02 is fine compared to the rest of the industry. CSU outperforms 70.31% 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.
CSU has a worse Debt to Equity ratio (1.20) than 65.63% of its industry peers.
Even though the debt/equity ratio score it not favorable for CSU, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.2 | ||
| Debt/FCF | 2.13 | ||
| Altman-Z | 4.02 |
ROIC/WACC0.94
WACC9.8%
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 has a worse Current ratio (1.02) than 60.94% of its industry peers.
A Quick Ratio of 1.00 indicates that CSU should not have too much problems paying its short term obligations.
CSU has a worse Quick ratio (1.00) than 60.94% 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.
The Earnings Per Share has been growing by 24.67% on average over the past years. This is a very strong growth
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.
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
A Price/Earnings ratio of 24.71 indicates a rather expensive valuation of CSU.
Compared to the rest of the industry, the Price/Earnings ratio of CSU indicates a rather cheap valuation: CSU is cheaper than 84.38% of the companies listed in the same industry.
CSU's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.92.
Based on the Price/Forward Earnings ratio of 20.59, the valuation of CSU can be described as rather expensive.
Based on the Price/Forward Earnings ratio, CSU is valued a bit cheaper than the industry average as 76.56% of the companies are valued more expensively.
CSU's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.46.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.71 | ||
| Fwd PE | 20.59 |
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.
Based on the Price/Free Cash Flow ratio, CSU is valued cheaper than 81.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.12 | ||
| EV/EBITDA | 17.22 |
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.
CSU's earnings are expected to grow with 18.00% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.45
PEG (5Y)1
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 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
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 (12/24/2025, 7:00:00 PM)
3316.17
-15.15 (-0.45%)
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 Cap70.27B
Revenue(TTM)11.15B
Net Income(TTM)666.00M
Analysts78.75
Price Target5070.79 (52.91%)
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-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)-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 | 24.71 | ||
| Fwd PE | 20.59 | ||
| P/S | 4.61 | ||
| P/FCF | 20.12 | ||
| P/OCF | 19.57 | ||
| P/B | 14.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.22 |
EPS(TTM)134.22
EY4.05%
EPS(NY)161.08
Fwd EY4.86%
FCF(TTM)164.79
FCFY4.97%
OCF(TTM)169.44
OCFY5.11%
SpS719.92
BVpS224
TBVpS-295.48
PEG (NY)1.45
PEG (5Y)1
Graham Number822.48
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 | 4.02 |
F-Score5
WACC9.8%
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 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 24.71 and the Price/Book (PB) ratio is 14.8.
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.