Topicus.com

TOI.V

Software - Application · Technology

Price

C$92.23

-3.17 (-3.32%)

Market Cap

C$7.69B

Exchange

Toronto Stock Exchange Ventures

Winston Score

Winston is curious

A decent business — some strong pillars, some weaker.

Share count rising — dilution

+41.9% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 91.5M (2021) → 129.8M (2025)

Topicus.com is a software company that builds and sells specialized software tools for organizations in Europe. Its products serve niche markets like healthcare, education, government, and financial services — helping those organizations manage their day-to-day operations. Topicus is a spin-off of Constellation Software, one of Canada's most successful software acquirers.

The company makes money by charging customers recurring subscription and maintenance fees for its software. It operates almost entirely in Europe, with a strong presence in the Netherlands, and generates roughly $2 billion in annual revenue. Its competitive advantage comes from owning highly specialized "vertical market software" that customers rarely switch away from, since replacing it is costly and disruptive. The main growth strategy is acquiring more small, niche software businesses in Europe — similar to how its parent Constellation Software operates — which means the pace of deal-making and available acquisition targets are key factors to watch.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+22.5% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+36.7% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

$0/ year

↓ Declining (-100% vs prior year)

0.0% of revenue

Below sector average (15%)

R&D spend declining — could signal cost-cutting or efficiency

Insider Activity

50.0%ownership

Insiders own a meaningful stake in the company

Cash Position

Cash flow positive

$860M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

Topicus.com is a rare growth stock that's already generating positive cash flow while growing at 22%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

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Quality

Gross Margin

22.9%

Thin — 22.9% gross margin

Operating Margin

15.5%

Healthy — 15.5% operating margin

ROCE

7.0%

Weak — 7.0% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales YoY

+21.2%

Fast-growing sales (21.2% YoY)

EPS YoY

-51.3%

Earnings shrinking (-51.3% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

6/8 quarters

Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion

1243%

Turns 1243% of profit into real cash

FCF Margin

24.2%

Converts sales into free cash efficiently (24.2%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity

0.88

Moderate — manageable debt (0.88)

Interest Cover

6.52x

Adequate interest coverage (6.5x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

159.0x

Expensive — P/E 159.0

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+126.5

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (159.0 → 32.5)

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Dividends

Not applicable for this business.

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