It’s Canada’s answer to Berkshire Hathaway (NYSE:BRK.B): Constellation Software (TSE:CSU). It’s made a name for itself by picking up a wide range of software products and bundling them under one overarching umbrella. Constellation has been on an upward tear over the last year, with shares climbing roughly 60% as it continues setting new highs.
Its focus on buying up small-scale software firms that pursue specific market niches is where the main comparisons to Berkshire Hathaway kick in. Constellation, meanwhile, doesn’t offer a lot of insight into its operations, however, eschewing quarterly conference calls or offering guidance to investors. Earlier estimates suggest that Constellation has dropped over $8.71 billion on acquisitions—a total of 867, at last report—just since 2005.
Its Latest Big Move Catches Attention
One of those niche market software firms Constellation seems particularly interested in is Conduent (NASDAQ:CNDT), which sold Constellation both its Public Safety Solutions and its Curbside Management Solutions operations to one of Constellation’s divisions, Modaxo. Valued at around $260 million, Conduent’s Curbside Management Solutions focuses on parking management, particularly managing operations and collecting fees. Meanwhile, Public Safety includes things like red-light cameras and automated enforcement operations.
Is Constellation a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on CSU stock based on three Buys and two Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average CSU price target of C$3,500 per share implies 0.43% upside potential.
