Constellation Software is one of the few names where AI disruption likely widens the opportunity set. @cap_zay points to its culture, lack of stock-based compensation, diversification and an acquisition hunting ground that has just become more fertile. x.com  x.com 

Constellation Software and Topicus are being wrongly lumped in with AI software fears, setting them up to rerate back toward a 3% free cash flow yield once things clear. They adapt, execute and take advantage of deals, with record capital deployments, and moats in vertical market software are shifting rather than disappearing; much of software can adapt with the right culture. A post the author replies to counters that new competitors have beaten Harris and Tyler in govtech. x.com  x.com  x.com 

Constellation Software has no way to benefit from AI and little organic growth, so 21x GAAP EBIT looks fair, with perhaps a downside skew if churn rises across its portfolio in the next five years. The market's negative reaction is rational. Its small vertical software businesses were run financially rather than for product, many still on-prem, with no central AI strategy as software gets cheaper to build. Organic growth was 2% in constant currency; inorganic growth is fundamentally different. … Show more

Constellation Software remains the gold standard of not doing dumb things, and half the game is owning companies that avoid them. Takeaways from its AGM: it is firing on all cylinders, it has its own inference hardware and hosted models, and AI may let it charge more for new features and underwrite higher IRRs faster than rivals, though it may also raise attrition. Harris's Bender sees a possible wave of competition, but none has appeared yet. x.com  x.com  x.com  x.com 

The Constellation family, Constellation Software, Topicus.com and Lumine Group, is still due for a rerating as the market's fear about AI gives way to the opportunity. The market has already misread AI's impact on Google, Meta, ServiceNow, Salesforce, CrowdStrike and Palo Alto Networks; in each case the fear was priced in long before the opportunity was understood. x.com 

Constellation Software's Sabre deal is one of the dumbest capital allocation decisions in years, enough to reverse a fresh view on the stock in under a month. Constellation should be buying smaller, solvent companies. x.com  x.com 

Constellation Software is a good opportunity in a market said to have none, because it has doubled free cash flow available to shareholders while its market cap has gone nowhere. x.com 

Constellation Software is finally at a fair valuation, making it a good time to accumulate. It has three big opportunities: new types of investments such as small stakes in public companies, adding AI to its thousands of software products at little extra cost, and buying small software companies in Asia and other less competitive regions. x.com 

Constellation Software, Microsoft and S&P Global deserve higher prices than they trade at after correcting in June, and current levels could be good long-term entries. Near-term headwinds remain: as long as semiconductors and memory lead the market, SaaS will perform poorly, with many hedge funds and institutions long semis and short SaaS. x.com 

SaaS will have its time in the sun again, and now, while it is still hated, is the time to pick favorites and build positions. Bearish sector narratives don't last forever, and the view that all SaaS is being disrupted should ease somewhat this summer, though multiples may not return to prior levels. Some SaaS names have little moat against Anthropic and peers, but many, especially cybersecurity and Palantir, are strengthened by the agentic push. x.com  x.com  x.com