# CSU Constellation Software



## gibor365 (Apr 1, 2011)

What happened to CSU? it was down 6% on Friday. Couldn't find any news...


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## BullAllTheWay (Feb 29, 2012)

Excellent results released Wednesday. It will be interesting to listen to the CC Thursday morning, just before the bell. The stock still looks pretty cheap for me. The balance sheet is very solid and management negociated a larger credit facility, which should help fund bigger acquisitions. With earnings close to $8 in 2011, I see the dividend going higher later this year.


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## riseofamillionaire (Feb 23, 2012)

BullAllTheWay said:


> Excellent results released Wednesday. It will be interesting to listen to the CC Thursday morning, just before the bell. The stock still looks pretty cheap for me. The balance sheet is very solid and management negociated a larger credit facility, which should help fund bigger acquisitions. With earnings close to $8 in 2011, I see the dividend going higher later this year.


They must have some great minds behind the scenes to be able to work with many different types of systems and make it so profitable. Im not up on this one, but story sounds good.


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## doctrine (Sep 30, 2011)

Definitely a good buy. Don't own it, but strongly considering it. It's also pulled back nicely since earnings.


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## PMREdmonton (Apr 6, 2009)

If the company is good, the fundamentals are good, the dividend is good, the balance sheet is good - so why is the market so pessimistic after the results - was there bad guidance given?


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## riseofamillionaire (Feb 23, 2012)

PMREdmonton said:


> If the company is good, the fundamentals are good, the dividend is good, the balance sheet is good - so why is the market so pessimistic after the results - was there bad guidance given?


prob just an irrational move, therefore a buying opportunity.


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## doctrine (Sep 30, 2011)

It's well valued at current prices, but also not a huge company at $2B. If there were a few decent sized investors who got in, say, at $20-30 or maybe even lower and wanted to sell their gains now that the stock is becoming more normally valued at ~10 times earnings, they may have decided to get out once it hit the 52 week high. The stock has doubled in the last year so lots of people will probably want to lock in gains.


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## leeder (Jan 28, 2012)

Strong Q4 and annual results for Constellation Software. Up 10%+ today.


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## humble_pie (Jun 7, 2009)

leeder said:


> Strong Q4 and annual results for Constellation Software. Up 10%+ today.


félicitations if u are holding.

longtime favourite of successful small cap specialists pembroke asset management. Their golden track record goes back to 1968, ie longer than CSU has been in existence though.

don't forget the dividend is paid in USD. Hold this stock in a USD account.


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## leeder (Jan 28, 2012)

Thanks hp - I bought it last year at less than $120, so this stock has doubled for me. Hope it continues to grow and still find acquisition targets. Unfortunately, I don't hold it in a USD account, but not a huge issue with the whole USD aspect.


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## JordoR (Aug 20, 2013)

Nice gains today. I saw it this week on a TDW report as a recommended buy, but I was already tapped on my tech sector.


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## leeder (Jan 28, 2012)

Is it from TDW? TDW has always given the 'hold' position on CSU. One thing I'm concerned is the remark from their President, Mark Leonard, who said that he anticipates making further acquisitions, which may consume the free cash flow. When that happens, CSU would not hesitate reducing or eliminating the dividend.

Not that they pay a high yield, but I wonder if shareholders would respond unkindly to his remarks or his plan.


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## londoncalling (Sep 17, 2011)

you can always journal the shares over to USD


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## CPA Candidate (Dec 15, 2013)

leeder said:


> Is it from TDW? TDW has always given the 'hold' position on CSU. One thing I'm concerned is the remark from their President, Mark Leonard, who said that he anticipates making further acquisitions, which may consume the free cash flow. When that happens, CSU would not hesitate reducing or eliminating the dividend.
> 
> Not that they pay a high yield, but I wonder if shareholders would respond unkindly to his remarks or his plan.


No smart investor would have a problem with a company delivering a 35% return on equity hanging onto cash and reinvesting in the business.

Anyway CSU needs financing for the long term so it will be interesting to see how they deal with this, because cutting the dividend is not going to make a big difference.


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## BlackThursday (Apr 25, 2011)

CPA Candidate said:


> No smart investor would have a problem with a company delivering a 35% return on equity hanging onto cash and reinvesting in the business.


No smart investor would rely on a company delivering a 35% return on equity.


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## leeder (Jan 28, 2012)

^ Maybe it's the way I read it, but why wouldn't anyone rely on a company that can deliver good growth (i.e., 35% ROE)? True, it's not cheap, but the company has delivered even through the bad times.


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## BlackThursday (Apr 25, 2011)

leeder said:


> ^ Maybe it's the way I read it, but why wouldn't anyone rely on a company that can deliver good growth (i.e., 35% ROE)? True, it's not cheap, but the company has delivered even through the bad times.


Maybe I am being to subtle.
Try: "If you have a brain then you shouldn't depend on a company returning 35% ROE consistently because it is simply not possible to sustain."
If you don't know why then good luck - I give up.


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## CPA Candidate (Dec 15, 2013)

BlackThursday said:


> Maybe I am being to subtle.
> Try: "If you have a brain then you shouldn't depend on a company returning 35% ROE consistently because it is simply not possible to sustain."
> If you don't know why then good luck - I give up.


The point is an investor is extremely unlikely to take the dividends and earn a rate of return better than this company is delivering. Of course it won't be sustained indefinitely, and I never said that it could be.

When the firm is deciding how much to pay out and how much to keep they are considering 3 main points:
-The firm's present investment opportunities
-The investor's present investment opportunities
-Tax implications


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## Butters (Apr 20, 2012)

Jason Donville has owned Constellation Software (CSU.TO) for a couple years now, with 60% returns

he recommended it on BNN again as a top pick expecting another 60%

he said $250 before he was right, said $300 now (its 295), and says next year will be $400


any CMFers have any comments?


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## gibor365 (Apr 1, 2011)

SheaButters said:


> Jason Donville has owned Constellation Software (CSU.TO) for a couple years now, with 60% returns
> 
> he recommended it on BNN again as a top pick expecting another 60%
> 
> ...


I personally wouldn't buy stock with P/E 58 and yield 1.5%


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## Pluto (Sep 12, 2013)

SheaButters said:


> Jason Donville has owned Constellation Software (CSU.TO) for a couple years now, with 60% returns
> 
> he recommended it on BNN again as a top pick expecting another 60%
> 
> ...


Such predictions depend partly on if the bull market continues. Most of the high p/e high fliers don't do well when the bull ends. don't be greedy. If its up trend stalls, sell and watch it consolidate. If it breaks out up again you can buy it back.


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## CPA Candidate (Dec 15, 2013)

gibor said:


> I personally wouldn't buy stock with P/E 58 and yield 1.5%


There's bit more to the story than that. The three year earning growth rate is 46% and looking forward the multiple is < 20. When a company is acquiring on a regular basis, there are a lot of one time expenses which tend to obscure the true earnings in the short term.

I started watching the stock at $130 but didn't buy it until $190. Three years ago it was a $60 stock. Tough to argue with the results, nearly a 5-bagger in three years.

A nice part of having a high stock price per share is that is scares away traders and momentum investors and the stock isn't that correlated to the overall market. During the recent TSX plunge, CSU didn't budge at all really.

Anyway, did anyone notice the 3 year average return of Donville's fund? 35% per year.


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## CPA Candidate (Dec 15, 2013)

CSU is only up 57% since my last post in this thread.


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## lh0628 (Dec 17, 2013)

Looking at the 10-year chart, this is one smooth sailing stock!

I remember looking at it last year when it was around $250, now it's at $440..


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## CPA Candidate (Dec 15, 2013)

$480 today. Up 33% YTD.


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## Butters (Apr 20, 2012)

yeah it goes up like 1% every day... glad i finally bit the bullet... i wonder what jason donville will say next time he is on BNN... last time he was on he said he was still buying it at the $430 mark


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## Butters (Apr 20, 2012)

Anyone want to help me understand this
(im with questrade)

Now I only have 5 shares, it says I need 10.596

So what options do I have, and what steps do I need to take

Can I get these, or sell the rights



_The Rights will be issued in satisfaction of the Rights Dividend in the amount of one Right per Common Share. For every 10.596 Rights held, the holder of such Rights will be entitled to subscribe for C$100 principal amount of Debentures. The Rights and the Debentures have been qualified for distribution in each province and territory of Canada by way of the Final Prospectus and the Debentures have been registered in the United States on Form F-7 under the United States Securities Act of 1933, as amended.

The Rights will be exercisable until 4:30 p.m. (Toronto time) (the “Expiry Time”) on September 15, 2015 (the “Expiry Date”) at a price of C$115 per C$100 principal amount of Debentures purchased. Rights not fully exercised prior to the Expiry Time on the Expiry Date will be void and of no further value.

The Rights will be listed on the Toronto Stock Exchange (the “TSX”) under the symbol “CSU.RT.A” and will be posted for trading on the TSX until 12:00 p.m. (Toronto time) on the Expiry Date, at which time they will be halted from trading. The TSX has approved the listing of the Rights and the Debentures, subject to the Company fulfilling all of the requirements of the TSX.

The Debentures are expected to be issued on September 30, 2015 and will have the same terms and conditions as the Existing Debentures._


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## el oro (Jun 16, 2009)

If you want to buy the debentures, buy more rights. If not, do nothing. The sell transaction cost is higher than the value of your 5 rights.


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## Ponderling (Mar 1, 2013)

Into this one as a Canadian play that spits dividends, and along with OTC is one of a small pool of Canadian software plays. 

Not sure if there is a huge upside to this stock, but if it can hold its own as a bunch of other holdings get mired in likely interest rate hikes.

So this and OTC holds about 10% of my non -registered holdings, as a sector equal weighted approach.


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## namelessone (Sep 28, 2012)

I bought some CSU in 2012. Gradaully reduced the positions. I completely got rid of it in July 2015. The PE of 100 is insanity. A fair valuation would be around $150/share.


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## CPA Candidate (Dec 15, 2013)

namelessone said:


> I bought some CSU in 2012. Gradaully reduced the positions. I completely got rid of it in July 2015. The PE of 100 is insanity. A fair valuation would be around $150/share.


I have a trailing PE of 59, not 100.


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## namelessone (Sep 28, 2012)

CPA Candidate said:


> I have a trailing PE of 59, not 100.


Its EPS stagnates in the past 4 years. The average EPS from past 4 years is ~$5/share. That gives a PE of 111. This is the method from Benjamin Graham. Looking at the earning from 1 year is not reliable. Its yield dropped from 4.3% 3 yeas ago to the current yield of 0.95%. This tells you how insanely expensive this stock is. Its earning can't grow at 100% per year for the next 5 years. The stock price of CSU will stagnate for years until earning catches up.


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## Infinity7 (Feb 21, 2016)

$CSU 2015 results are quite good:
- Revenue grew 10% (negative 3% organic growth) 
- Adjusted EBITA increased 28% 
- Adjusted EBITA margin increased 3% from 21% in 2014 to 24% in 2015. Changes in foreign exchange rates resulted in less than a 1% reduction in Adjusted EBITA margin. 
- Adjusted net income increased 35%


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## doctrine (Sep 30, 2011)

Adjusted P/E is 29 based on trailing 12 month earnings, but non-adjusted P/E is double at 61. It also trades at an insane 25 times price to book. The company is doing well but I just can't see paying this much.


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## CPA Candidate (Dec 15, 2013)

I sold all my CSU initially purchased at $190 over the past few months. The issue looking forward is that the company has reached such a size that it is going to be increasingly difficult to make acquisitions that can make a substantial increase in earnings and as the earnings growth rate declines, so will the valuation multiple and the stock price. This is the natural end to all industry consolidation by acquisition stories.

The stock went on a tear in the first 6 months of 2015 but I get a sense that "the market" is backing away now and for the trend followers, it is "broken".

Let's call CSU what it is, a finance 101 experiment, a conglomerate of software businesses that act independently, levered to the hilt to produce crazy ROE. The equity base of the company doesn't grow as about 100% of earnings are paid out. I fail to see how they can keep using debt alone to fund acquisitions without getting hit with higher interest rates and lower valuations to compensate for the additional risk.

Therefore, my opinion is that the company has reached a crossroads and I'm waiting by the side of the road to see what happens.


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## Infinity7 (Feb 21, 2016)

*doctrine*, net income is growing much faster than revenue (68% vs. 16% in 2015), so P/E in 1-2 years will be reasonable, that's why it's insane now!


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## besmartrich (Jan 11, 2015)

This is a really tricky stock for me. The business is doing probably the best among TSX listed stocks but seems high premium is attached to it. Would a bad news ever come out on this one?


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## james4beach (Nov 15, 2012)

It's interesting looking back at this thread. CSU now at $631 and valued at $13 billion -- crazy. Something that hasn't been mentioned in this thread is that CSU correlates very strongly to the overall tech sector as shown here. CSU in green, XIT in black
http://stockcharts.com/h-sc/ui?s=CSU.TO&p=D&yr=4&mn=0&dy=0&id=p61920138304

The 2016 price movement in CSU and XIT is virtually identical.

*So I think this is a sector story, not a Constellation-specific story.*

If you're bullish on Constellation, you might as well buy XIT and diversify your exposure a bit. At least you eliminate single company risk. The remaining question is, how long will this tech bubble continue?

XIT has returned 17.54% annually for the last 5 years


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## MrBlackhill (Jun 10, 2020)

Not sure how I should track my return on investment with the Topicus spin-out. I would have to somehow link my CSU investment to my Topicus shares to recall that I never bought those shares, but got them from CSU. I don't know either how I should track my P&L on Topicus.


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## cliffsecord (Jan 10, 2020)

I'm going to keep my ACB of CSU the same and Topicus ACB=0. Maybe there will guidance from CSU in the coming weeks?


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## james4beach (Nov 15, 2012)

The Topicus thing really confused me too. Luckily I hold this in a TFSA but I'm still curious how to think of it from a % return standpoint.

They seem to be in limbo in my trading account. How many Topicus shares were given for each share of CSU ?


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## MrBlackhill (Jun 10, 2020)

james4beach said:


> The Topicus thing really confused me too. Luckily I hold this in a TFSA but I'm still curious how to think of it from a % return standpoint.
> 
> They seem to be in limbo in my trading account. How many Topicus shares were given for each share of CSU ?





> In connection with the completion of the Spin-Out Transactions, on January 4, 2021, all of Constellation’s common shareholders of record on December 28, 2020 received, by way of a dividend-in-kind, 1.859817814 subordinate voting shares of Topicus.com (the “Spin-Out Shares”) for each common share of Constellation held.


(I even made some free money from being on the right side of the rounding. No fractional shares.)

I think 0 ACB on the free Topicus shares is the right way to report it.

To me, though, I want to track how my initial investment in CSU performed. So if I have 100 shares of CSU which gave me 186 shares of TOI, I'll track my CSU performance as a combination of my CSU position and my position on those 186 TOI shares. Seems a bit complex though. Even more complex if ever I start buying TOI shares.

And what if you start buying TOI shares afterwards? Your ACB will stay low simply due to those free shares. And how will you track the performance of TOI?

Seems like the performance of TOI will have to be split in two stages. Free shares vs bought shares.


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## james4beach (Nov 15, 2012)

MrBlackhill said:


> I'll track my CSU performance as a combination of my CSU position and my position on those 186 TOI shares. Seems a bit complex though


Definitely is complex, I agree.

Each CSU share is supposed to get 1.86 Topicus shares, right?

I just realized that I'm not even seeing the Topicus value in my account yet. Wow. This means my growth/momentum portfolio is performing even better than I realized because I've been looking at the value with Topicus stuck at $0

Do we have a rough idea what the share price will be? I'm seeing bid/ask around $71. Is it really that high?


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## MrBlackhill (Jun 10, 2020)

james4beach said:


> Definitely is complex, I agree.
> 
> Each CSU share is supposed to get 1.86 Topicus shares, right?
> 
> ...


It was supposed to start trading today but it has been pushed to tomorrow. That's why it's still at 0.

I see $68 so I guess your $71 is about right. Not sure it should be traded at that price though... CSU is trading around $1600. If it gave 1.86 shares valued at $70 each that's $130. And that $130 added to $1600 means about +8%. Giving those shares didn't affect CSU, or it's blended in its volatility. I think the shares should be worth below $10 (below +1%), but I certainly wouldn't complain on that +8%. Maybe it'll start high and drop fast, like some IPO euphoria.


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## MrBlackhill (Jun 10, 2020)

Wow it currently really is trading at $65...

We'll see how long it lasts. If it's sustainable then that's really amazing because that's a +8% to my biggest investment (CSU is my top holding).


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## james4beach (Nov 15, 2012)

No idea where the shares will stabilize. Maybe this was impatient of me, but I sold my Topicus shares at 64.10 to treat it like a 'cash' dividend.

This is like a 7% boost to my overall CSU position, using the share count I got. I consider that a pretty significant increase to the "total return" position and I'd rather take it as guaranteed cash. This is part of my growth portfolio, and this value will be redeployed to something other than TOI.

For me, it's a question of liquidating now or liquidating within 6 months. I chose now, plus this makes my tracking easier; it's just like a cash dividend for me at this point.

My growth portfolio is now up 20% versus the summer, versus 14% for my XIC benchmark.


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## MrBlackhill (Jun 10, 2020)

james4beach said:


> No idea where the shares will stabilize. Maybe this was impatient of me, but I sold my Topicus shares at 64.10 to treat it like a 'cash' dividend.
> 
> This is like a 7% boost to my overall CSU position, using the share count I got. I consider that a pretty significant increase to the "total return" position and I'd rather take it as guaranteed cash. This is part of my growth portfolio, and this value will be redeployed to something other than TOI.
> 
> ...


Yes, I think it's a good decision.

In fact, I have no clue if there is a better decision at the moment.

I decided to hold it because I'm curious how a spin out of CSU will perform, since CSU has one of the top management teams in the world and I'm curious how TOI will do.

CSU is holding 1 Super Voting Share of Topicus, representing 50.1% voting power, so CSU will have their say.


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## james4beach (Nov 15, 2012)

MrBlackhill said:


> Yes, I think it's a good decision.


I'm glad I sold, for my position management, but holding on seems fine too. TOI is now up over $65


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## I am the Walrus (Jul 9, 2018)

I have 6 shares of CSU in my non-registered account and now also have 10 shares of topicus..

I have 4 shares of CSU in my TFSA and have no additional Topicus shares.

is this correct? I thought I would have 6 shares of topicus in the tfsa


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## I am the Walrus (Jul 9, 2018)

This is an interesting article.. here is an excerpt..

“The plan to create a publicly listed operating group made up of Topicus and TSS was a key part of our discussions with the Topicus founders. They didn’t want their legacy disappearing into the craw of an omnivorous conglomerate. While they knew that Topicus would have autonomy within Constellation, they also wanted identity. The public listing is expected to afford our Netherlands-based businesses a platform from which to celebrate their culture and achievements.”

– Constellation press release – May 20, 2020


https://baskinwealth.com/an-ernest-opinion/constellation-software-spin-off-of-topicus-com/


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## I am the Walrus (Jul 9, 2018)

from above article...

“In May 2020, Constellation’s subsidiary TSS acquired Netherlands-based Topicus.com BV (I’ll call the pre-merger Old Topicus) with a plan to seek a separate listing of the combined companies which would be named Topicus.com. Constellation had originally planned to complete the spin-off by November 2020, but for undisclosed reasons has delayed it to a future date.
The stock will be dual-listed in the Netherlands and on the TSX Venture exchange. The total purchase price is valued at EUR 217.4m with TSS paying EUR 133.6m and IJssel (the seller) buying 9% of TSS for EUR 83.8m. IJssel will also commit an additional EUR 27.6m loan to TSS. The debt required to finance the deal will be funded entirely at the TSS-level without recourse to Constellation Software.”

So CSU bought old topicus for 217.4M euro 
TSS was valued at (9%=83.3M = 925.5M euro)
217.4 + 925.5 = 1.142 Billion euro 

1.142b x 1.54 = 1.759 Billion

Topicus market cap 2.583 Billion = 46% value increase 

This is back of napkin - might be incorrect.


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## MrBlackhill (Jun 10, 2020)

I am the Walrus said:


> I have 6 shares of CSU in my non-registered account and now also have 10 shares of topicus..
> 
> I have 4 shares of CSU in my TFSA and have no additional Topicus shares.
> 
> is this correct? I thought I would have 6 shares of topicus in the tfsa


Hmm sounds weird.

6 x 1.86 = 11
4 x 1.86 = 7

I would expect you to have those shares.

I'm also wondering how it worked out for those holding XIT...


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## I am the Walrus (Jul 9, 2018)

MrBlackhill said:


> Hmm sounds weird.
> 
> 6 x 1.86 = 11
> 4 x 1.86 = 7
> ...


I forgot that in January there was a delay in transferring my tfsa from my old advisor, and the remaining Topicus shares got left over there.

problem solved, thx


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## james4beach (Nov 15, 2012)

This spinout was even more complex than I realized at first. The spinout TOI shares were assigned a fair market value of $0.0001 at the time of distribution, so all index providers saw the spinout as negligible, just about zero value. Then only *after* the pay date, another entity did the TOI acquisition, which bounced the share value up to $66. So the corporation(s) structured this spinout and buyout in a weird way.

TOI really was initially worth close to zero, on paper. The acquisition which boosted the share value was dependent on the spinout occurring successfully. So this wasn't just a ticker price glitch... first it was worthless. Then the acquisition fully completed. If that acquisition had not occurred, TOI would still be closer to $0 today.

This is also why TOI ended up on Venture! It didn't have a high enough share price/market cap to be listed on the TSX. Today of course it's absolutely huge at $2.3 billion, so it's kind of funny that it's on Venture.

There are several weird consequences of this, according to a proprietary Bay Street note I've seen. Apparently XIT is going to outperform its benchmark index, because the index ignored the TOI value. It seems that all the indexes ignored TOI because of its near zero valuation at dividend time.

Something that really might be of consequence. The proprietary note I read said that derivative-based synthetic index positions, like the Horizons ETFs, actually miss out on the TOI value because the index doesn't track it! So the Horizon ETF will track the index (because there is a swap which is a contract to track the index), but the index itself missed out on TOI due to a quirk in how they value spinoffs and dividends. Meanwhile, a conventional ETF that actually holds real stocks (not the derivatives) will outperform the derivative tracking funds.

Perhaps one way of looking at this is that the $66 value of TOI arrived through a series of legal agreements which had prerequisite conditions. The value wasn't crystalized until those steps took place, and it took some time to occur. Long enough that when the index looked at the TOI position, it saw it as worthless, and dropped TOI (oops).

So... we shouldn't feel bad that we've all gotten confused along the way. Even Bay Street and index ETFs are confused by this event.


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## MrBlackhill (Jun 10, 2020)

james4beach said:


> This spinout was even more complex than I realized at first. The spinout TOI shares were assigned a fair market value of $0.0001 at the time of distribution, so all index providers saw the spinout as negligible, just about zero value. Then only *after* the pay date, another entity did the TOI acquisition, which bounced the share value up to $66. So the corporation(s) structured this spinout and buyout in a weird way.
> 
> TOI really was initially worth close to zero, on paper. The acquisition which boosted the share value was dependent on the spinout occurring successfully. So this wasn't just a ticker price glitch... first it was worthless. Then the acquisition fully completed. If that acquisition had not occurred, TOI would still be closer to $0 today.
> 
> ...


Interesting, thanks for the info.


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## MrBlackhill (Jun 10, 2020)

CSU announced TOI's financial results and TOI is back to its ~$65 level.


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## james4beach (Nov 15, 2012)

MrBlackhill said:


> CSU announced TOI's financial results and TOI is back to its ~$65 level.


I saw the shares rally, that's pretty neat. This also means that the initial IPO/acquisition valuation was pretty accurate .... which is great to see.

I'm having a hard time finding anything bad to say about Constellation and their management. I first bought into this in mid 2019. It wasn't a particularly great entry point, but still...


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## MrBlackhill (Jun 10, 2020)

james4beach said:


> I saw the shares rally, that's pretty neat. This also means that the initial IPO/acquisition valuation was pretty accurate .... which is great to see.
> 
> I'm having a hard time finding anything bad to say about Constellation and their management. I first bought into this in mid 2019. It wasn't a particularly great entry point, but still...
> 
> View attachment 21261


Yes, they've been amazing.

They've been slowing lately though, during the past 5 years. But when "slowing" means slowing down to "only" 20% CAGR, lol...


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## MrBlackhill (Jun 10, 2020)

CSU up +4%.
TOI up +4-5% to $73-75.

CSU wants to cut dividends to have more money for bigger acquisitions.

I can't be happier than this.


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## MrBlackhill (Jun 10, 2020)

Loving CSU even more. The only tech stock standing strong.


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## james4beach (Nov 15, 2012)

MrBlackhill said:


> I'm also wondering how it worked out for those holding XIT...


I'm still curious about this too. XIT had a massive internal (reinvested) distribution but that was dated end of December. But if these CSU transactions all completed in 2021, maybe there are still more distributions coming.

I don't see any TOI holding in XIT today... I'm not sure what iShares decided to do with the spun out shares.


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## Covariance (Oct 20, 2020)

It will be quite interesting to see how the valuation of TOI changes once it moves off the venture exchange, and eventually into the indexes the ETFs track.


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## james4beach (Nov 15, 2012)

Covariance said:


> It will be quite interesting to see how the valuation of TOI changes once it moves off the venture exchange, and eventually into the indexes the ETFs track.


Will be nice to see TOI on a real stock exchange


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## MrBlackhill (Jun 10, 2020)

Amazing CSU.

I was looking at its performance since I bought it in late April 2020 and I was happy. And then I remembered that they gave me TOI shares which are now at $100/share and I was even happier.

That's the kind of total return on investment that goes unseen under the radar when backtesting stocks.

My CSU shares are up +47% since I bought them last year. But when I add the current value of TOI, my ROI is actually +63%. Sure, I shouldn't look at the current value of TOI because they are now independent, but instead at the value when I got them, but that's still a +58%.


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## Covariance (Oct 20, 2020)

MrBlackhill said:


> Amazing CSU.
> 
> I was looking at its performance since I bought it in late April 2020 and I was happy. And then I remembered that they gave me TOI shares which are now at $100/share and I was even happier.
> 
> ...


It’s a great company. Note they are not independent. CSU owns a large part of TOI and is on the board. They didn’t spin out the whole company to investors when they did the divi.


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## MrBlackhill (Jun 10, 2020)

Covariance said:


> CSU owns a large part of TOI and is on the board


Yeah 51% if I remember.


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## Covariance (Oct 20, 2020)

MrBlackhill said:


> Yeah 51% if I remember.


Not sure frankly. There were recent announcements about preferred shares converting which I have not accessed. If anyone has an up to date view of the ownership maybe they can post it here.


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## MrBlackhill (Jun 10, 2020)

Covariance said:


> Not sure frankly. There were recent announcements about preferred shares converting which I have not accessed. If anyone has an up to date view of the ownership maybe they can post it here.


Oh I recall that thing about the Super Voting Share.



> Holders of Subordinate Voting Shares are entitled to one vote per share, and CSI as the holder of the Super Voting Share is entitled to that number of votes that equals 50.1% of the aggregate number of votes attached to all of the outstanding Super Voting Shares and Subordinate Voting Shares at such time.


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## james4beach (Nov 15, 2012)

MrBlackhill said:


> And then I remembered that they gave me TOI shares which are now at $100/share and I was even happier.


That's great that you held on!

I wonder when TOI will start trading on the TSX.



MrBlackhill said:


> That's the kind of total return on investment that goes unseen under the radar when backtesting stocks.


But remember that there is a flip side to that. Some stocks fail and collapse, or fall severely and then acquired. Those go unseen from back-tests as well (survivorship bias).


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## james4beach (Nov 15, 2012)

This stock is just the gift that keeps on giving. Even when I sell some to lighten the position, it rallies back to become overweight in my portfolio again.

CSU has outperformed the TSX over the last 1 year and is about equal with the TSX year-to-date.


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## Jimmy (May 19, 2017)

This seems to be a core stock to most analysts and their portfolios. You have this, BAM and a few other good choices and you can destroy the market.


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## Covariance (Oct 20, 2020)

Looks like they are repeating the TOI model with another group.





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www.csisoftware.com


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