After a 40% drawdown, the market is questioning the M&A playbook. I believe it's missing the durability of the underlying engine, and the valuation is now attractive.
Thanks for reading and commenting! They both acquire and operate vertical market software companies, share a decentralized structure and grow mainly through acquisitions. Constellation is performing better indeed, but also with a clear premium in valuation.
Thanks a lot for this great article. I am considering investing in Vitec and for me, one of the potential red flag is the share dilution. Do you consider it as a concern ?
What makes it similar to Constellation? It cannot be ROIC, which isn’t even close to 10pc (long-term average).
I would consider it to be very expensive at +30 multiples.
Thanks for reading and commenting! They both acquire and operate vertical market software companies, share a decentralized structure and grow mainly through acquisitions. Constellation is performing better indeed, but also with a clear premium in valuation.
Thanks a lot for this great article. I am considering investing in Vitec and for me, one of the potential red flag is the share dilution. Do you consider it as a concern ?