CSU: Thoughts from Constellation's AGM

Research evidence excerpt

CSU: Thoughts from Constellation's AGM

6x 9.5x

Mark Leonard's practice of not taking a salary or bonus as President. Prev. 15.2x 12.6x 10.4x 8.5x

• AI opportunities outweigh AI risks. Constellation's managers see EPS, Adj Diluted 75.38 102.95 108.41 131.12

productivity gains from AI driving faster product innovation. There is a P/AEPS 25.2x 18.5x 17.5x 14.5x

large opportunity for Constellation to sell more into its customer base. Revenue Q1 Q2 Q3 Q4

Long-standing customer relationships and intimacy provide Constellation 2025 2,654.0A 2,844.0A 2,948.0A 3,177.0A

with insights to guide product development. Feedback suggests that 2026 3,181.0A 3,412.3E 3,607.0E 3,923.9E

Constellation's managers are less concerned about potential new AI 2027 3,917.4E 4,103.9E 4,323.3E 4,672.8E

EBITDA, Adj competitors or customers leveraging AI internally. To date, Constellation 2025 700.0A 804.2A 859.0A 913.0A

has not experienced churn due to AI. Constellation would like AI 2026 815.0A 954.7E 1,029.4E 1,130.1E

innovations to fuel higher organic growth. 2027 1,003.7E 1,148.2E 1,233.8E 1,350.5E

• Scaling capital deployment. Management commented that Priced as of market close on May 15, 2026.

Constellation's addressable market is large and likely to expand with AI. Strategic Ownership: Management & Employees (13%)

We previously heard that Constellation has 120k M&A targets, which AllPricedmarketas ofdatapriorintradingCAD; allday'sfinancialmarketdataclose,in USD.EST (unless otherwise noted).

implies Constellation has penetrated less than 2% of its addressable

market. The company is focused on small VMS acquisitions, which offer

the highest returns. Larger acquisitions, non-VMS acquisitions, and PEMS

help augment Constellation's core model. Share buybacks are a low