Constellation Software (CNSWF)

Tuesday

12:05 AM

ThesisRecent acquisition activity and strong recurring revenue growth are shifting investor sentiment positively, suggesting a recovery in stock performance.

Revenue Outlook

Metric	FY2025	FY2026E	FY2027E
Revenue	$11.6B	$13.8B	$16.2B
Rev. Growth	+15.5%	+18.9%	+17.0%
EPS	$24.58	$118.12	$136.36
EPS Growth	-28.7%	+381%	+15.4%
P/E (fwd)	86.5×	18.0×	15.6×

★ Analysts see FY2026 revenue reaching $13.8B — +18.9% growth in a single year.

Why Revenue Could Accelerate

01Recent acquisition of a healthcare software provider expected to add $150M in annual revenue and enhance market share.
02Strong growth in recurring revenue segments, with a reported 20% YoY increase in Q2 2026.
03Increased focus on cloud-based solutions, which could drive a 25% increase in customer acquisition rates over the next 12 months.
04Digital transformation in vertical markets
05Increased demand for cloud-based software solutions
06Acquisition announcements that expand its vertical market software portfolio
07Changes in recurring revenue growth rates
08Market sentiment regarding the software sector's growth potential

FY2025 Snapshot

Revenue: $11.6B
Rev. Growth: +15.5%
Gross Margin: 37.6%
Op. Margin: 7.9%
Net Margin: 4.4%
Net Income: $512M
NI Growth: -30.0%
EPS: $24.58
1Y Return: -33.5%

My Notes

"Management emphasized, 'Our strategic acquisitions are positioning us for sustained growth in key verticals.'"
Moat: Constellation's extensive portfolio and established customer relationships provide a durable competitive advantage.
growth - Investors are drawn to Constellation for its strong acquisition strategy and recurring revenue model.
Interest rates affect Constellation's cost of capital and can influence acquisition financing.
Watch on earnings: Recurring revenue growth rate, Operating cash flow, Free cash flow yield.

One Sentence Summary:

The bull case is simple: analysts see revenue climbing from $13.8B to $16.2B as recent acquisition of a healthcare software provider expected to add $150m in annual revenue and enhance market share.

Auto-composed from Stock Alarm intelligence, financial statements, and analyst estimates. Not investment advice.

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