Revised Analysts TargetsFebruary 14, 2018
Various analysts revised their price targets of Constellation Software, as follows.
RBC : $1,350 ( from $1,250)
BMO: $1,200 ( from $1,140)
CIBC: $1,250
Scotia:$1,160
Following are analysts commentary.
BMO Capital Markets “We recently upgraded the stock based on our increased comfort that Constellation can sustain a level of EBITDA [earnings before interest, taxes, depreciation and amortization] and cash flow growth that would make the stock attractive at its current valuation,” said analyst Thanos Moschopoulos.
The company’s strong fourth quarter results “in our view, provide further support to our thesis,” he said.
He kept his “outperform” rating and raised his target price to $1,200 from $1,140.
CIBC World Markets “Constellation reported strong fourth quarter results and announced a $20 per share ($424 -million) special dividend. We continue to see Constellation as well positioned in the current M&A environment, with acquisition spending reaching an all-time high in 2019. Constellation typically funds its M&A out of free cash flow, with the company accumulating excess net cash on its balance sheet over the past several years ($435-million ex-debentures at the end of the fourth quarter). We see the special dividend as a return of this excess cash to shareholders and have not changed our 2019 M&A expectations. We continue to view Constellation as best-in-class capital allocators and retain our Outperformer rating and $1,250 price target,” said analyst Stephanie Price.