I'd Invest $7,000 in This Single Stock for Generational Wealth
When it comes to building wealth that lasts, some stocks simply stand out — not because they're flashy or all over the headlines but because they deliver quiet, consistent performance year after year. If I had $7,000 to invest today and wanted to set it aside for decades, maybe even for future generations, there's one Canadian stock I'd pick: Topicus.com (TSXV:TOI).
Topicus isn't your typical growth company. Based in the Netherlands but listed on the TSX Venture Exchange, it specializes in acquiring and growing vertical market software businesses. That means it focuses on software companies that serve very specific industries. Think education, healthcare, public administration, and finance. These are areas where software becomes deeply embedded in operations, leading to high customer retention and recurring revenue. It's the kind of model that quietly compounds wealth over time.
Topicus was spun out of Constellation Software in early 2021, and it follows a similar acquisition-focused playbook. But it has a more regional focus, with a growing presence across Europe. Since the spinout, it has been steadily snapping up niche software companies, integrating them into its decentralized structure, and encouraging them to keep growing. That strategy has worked incredibly well for Constellation, and Topicus appears to be on a similar path.
Let's look at the numbers. In its most recent earnings report, Topicus posted revenue of €364.9 million for the fourth quarter (Q4) of 2024. That's up 18% from the same quarter a year ago. Net income came in at €56.2 million, a 32% increase from Q4 2023. For the full year, revenue rose 15% to €1.29 billion, and net income jumped 30% to €149.5 million. These numbers show a business that's growing both organically and through acquisitions, with solid control over costs.
It's also worth noting that Topicus is very good at converting revenue into cash. In 2024, it generated €347.6 million in cash from operations, up 41% year over year. Free cash flow available to shareholders came in at €177.4 million, up 44% from 2023. That kind of cash generation gives it the flexibility to keep buying great businesses without relying on debt or issuing more shares.
What makes Topicus so compelling for long-term investors is how boring and beautiful the business really is. Most of the software companies it owns serve very specific, regulated industries. Their customers rely on them every single day, and switching software providers would be a hassle. That means revenue is sticky, margins are high, and churn is low. It also means that once Topicus buys a company, that company tends to keep paying off for years or often decades.
Now, the stock isn't exactly cheap. As of writing, Topicus trades at about $172 per share, giving it a market cap of roughly $13.4 billion. But paying a premium for quality is often worth it when the business compounds value over time. And Topicus has proven it knows how to do that. Its return on invested capital is consistently high, and it's reinvesting that capital in more businesses that meet its strict acquisition criteria.
So, why would I put $7,000 into Topicus today? Because it offers the kind of compounding machine that few companies can match. It has a stable cash flow, sticky customers, and a clear path for long-term expansion. It's not trying to reinvent the wheel; it's just steadily adding more spokes to it. And that's exactly the kind of business you want when thinking about building wealth that lasts a generation or more.
The post I'd Invest $7,000 in This Single Stock for Generational Wealth appeared first on The Motley Fool Canada.
Before you buy stock in Topicus.com Inc., consider this:
The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Topicus.com Inc. wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.
Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $21,345.77!*
Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 24 percentage points since 2013*.
See the Top Stocks * Returns as of 4/21/25
More reading
Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS]
Market Volatility Toolkit
Best Canadian Stocks to Buy in 2025
Beginner Investors: 4 Top Canadian Stocks to Buy for 2025
5 Years From Now, You'll Probably Wish You Grabbed These Stocks
Subscribe to Motley Fool Canada on YouTube
Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Topicus.com. The Motley Fool recommends Constellation Software. The Motley Fool has a disclosure policy.
2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
23 minutes ago
- Yahoo
Narf Industries Full Year 2025 Earnings: US$0.002 loss per share (vs US$0.001 loss in FY 2024)
Narf Industries (LON:NARF) Full Year 2025 Results Key Financial Results Revenue: US$3.00m (down 51% from FY 2024). Net loss: US$3.56m (loss widened by 206% from FY 2024). US$0.002 loss per share (further deteriorated from US$0.001 loss in FY 2024). AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. All figures shown in the chart above are for the trailing 12 month (TTM) period Narf Industries shares are down 17% from a week ago. Risk Analysis Before you take the next step you should know about the 5 warning signs for Narf Industries (3 are significant!) that we have uncovered. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23 minutes ago
- Yahoo
P.E.I. hits record housing starts, but experts say more needed to restore affordability
Housing starts on Prince Edward Island reached a record high last year, but a recent report says even more construction is needed to make homes affordable. In 2024, there were 1,684 housing starts, a 48.7 per cent increase from the previous year and the highest total since the 1970s. That brings the province close to the goal laid out in its housing strategy, released last year, which identifies the need for an average of 2,000 new homes per year between now and 2030. But the latest supply gaps estimate report from the Canada Mortgage and Housing Corporation says that, based on projected demand, Canada needs to essentially double its current pace of home construction to return to pre-pandemic levels of housing affordability. For P.E.I., that means increasing the projected average of about 1,300 annual housing starts between 2025 and 2035 to nearly 2,200 per year — surpassing even the province's all-time record of 2,122 starts set in 1973. That remains the only year since 1948, the earliest data from CHMC is available, when housing starts on the Island exceeded 2,000. Construction industry at capacity Sam Sanderson, executive director of the Construction Association of P.E.I., said reaching 2,200 housing starts may prove difficult. He said the province's construction sector, which employs more than 8,500 people year-round, is already operating at full capacity. "To say it's not achievable, I'd be lying," Sanderson told CBC News. "But there needs to be some changes, there needs to be some additions, and there needs to be some investment into construction to even look at those numbers." Sanderson said innovations in the industry are helping, including pre-manufactured wall systems and modular construction that allow for faster, more affordable builds. LISTEN | This week's episode of the This is P.E.I. podcast looks into the building boom in the province, and what more needs to be done: But labour remains a major constraint. The industry is facing a shortage of skilled workers across multiple trades, he said, and productivity has dropped as experienced workers retire. "We're saying right now, it takes pretty near 2.2 new people to do the same amount of work one person did... 20 years ago or 10 years ago," Sanderson said. "We need to find ways to increase productivity." The association has been trying to bring more workers into the industry through training programs and outreach. Last year alone it made more than 50 visits to schools across the Island. But Sanderson said more investment is needed — not just into housing projects, but into people. That includes recruitment, training and skilled trades support, especially as P.E.I. competes with other provinces. He pointed to Nova Scotia's commitment, announced in 2023, to invest $100 million over three years in recruiting skilled tradespeople as the type of investment P.E.I. needs to match. "We need to see some large-scale investments like that into our industry here in P.E.I. to be able to increase our capacity to build," Sanderson said. He added that governments must also prioritize targeted immigration strategies to attract skilled workers for the construction industry. 'The momentum has continued' Staff with Fusion Charlottetown — a non-profit based in P.E.I.'s capital that advocates for youth and young adults on issues such as housing affordability — the record-breaking year was a welcome development. The pace has continued. In the first two quarters of 2025, there have already been 751 housing starts — the most for that time period since 1973. "We're definitely pleased to see it over the past year," said Fusion Charlottetown's vice-president, Matt Pelletier. "What we're pleased to see is that the momentum has continued." Pelletier acknowledged that the 2,200 target is ambitious, but said it can be within reach. "With the right mechanisms, the right fiscal tools and the right alignment with land use, it's possible to do that again," he said. "It's going to require all orders of government coming together to make that happen." Incentives and policy changes needed Before the province tabled its 2025-26 operating budget, Fusion Charlottetown submitted a list of policy recommendations aimed at boosting the housing supply. These included encouraging apartment construction in urban areas and funding "housing-enabling infrastructure" such as roads and sewer systems, which are essential for making new housing developments possible. Fusion Charlottetown is also calling for the extension of rental construction sales tax rebates to affordable housing projects. In the fall of 2023, the federal government brought in legislation to remove the GST on new rental developments. Shortly after, the P.E.I. government followed suit by eliminating the provincial portion of the HST for new rental builds in hopes of spurring construction. Fusion Charlottetown wants to see those rebates expanded to include different forms of affordable housing, such as co-operative housing and affordable home ownership initiatives like Habitat for Humanity projects. "Creating a sales tax mechanism to allow for those sorts of units to be built would be favourable when it comes to creating affordable housing options," Pelletier said. Prince Edward Island is managing the housing crisis just about as well as anyone in the country. — Mike Moffatt, Missing Middle Initiative The organization is pushing for municipal policy changes too, like harmonizing building codes, and it's also advocating for Charlottetown to have a fast-track approval system for affordable housing projects. "In a lot of cases, the delays relating to those can contribute to the input costs of affordable housing projects, effectively undermining the affordability that they're trying to create," Pelletier said. Is 2,200 the right number? Housing policy expert Steve Pomeroy said it's important to look critically at the 2,200 figure and consider whether that many homes are really needed on P.E.I. Pomeroy, an industry professor at McMaster University and member of the Canadian Housing Evidence Collaborative, said the CMHC's projections are a theoretical exercise focused only on supply. But he said the real challenge is ensuring affordability — and that won't be solved by supply alone. Developers are unlikely to build units that would lower their profits, leaving many new homes still out of reach for low-income residents, Pomeroy said. "So rather than just any kind of supply, we need to think about, how do we actually create supply of more affordably priced homes? Which means invoking the role of the non-market sector, non-profits and co-operatives who respond to different signals than the market does," he said. "Those are provided with subsidies from government… and they have a mission to address affordability." Pomeroy pointed to the broader need for more social housing across the country, citing a 2023 Scotiabank report that found just 3.5 per cent of Canada's total housing stock is social housing — half the Organisation for Economic Co-operation and Development average of around seven per cent. P.E.I. stands out on social housing Despite Canada's lag in social housing, P.E.I. is making some progress. The province's housing strategy includes a $176-million investment over five years to establish 560 government-owned social housing units. In a statement to CBC News, the Department of Housing, Land and Communities said that by the end of the last fiscal year, 227 new social housing units were under design and/or construction. That's already 40 per cent of the five-year target. WATCH | P.E.I. government giving millions to let housing non-profits and co-ops buy and rent out 116 units The province said it made a "historic" capital investment of $63 million in the 2024-25 fiscal year to support new social housing, adding a record 149 units to the system: 37 through construction and 112 through acquisitions. That surpassed the previous record set in 2023-24, when 142 units were added. "Through these investments, the social housing registry was reduced to the smallest waitlist in well over a decade, with a low of 389 as of March 31, 2025," the statement read. A national report card, released by the Missing Middle Initiative at the University of Ottawa, recently evaluated provincial housing policies across Canada. P.E.I. received an A for construction of social housing, the highest grade in the country. "Prince Edward Island… came out with a plan to increase social housing that was particularly detailed — more detailed than we're seeing here in Ontario," said Missing Middle Initiative founding director Mike Moffatt. "Overall, I think Prince Edward Island is managing the housing crisis just about as well as anyone in the country."
Yahoo
23 minutes ago
- Yahoo
Kering in talks with Qatar for sale of Milan building, Corriere says
ROME (Reuters) -Gucci-owner Kering is in talks with a member of the Qatari royal family for the sale of a building in Milan's top shopping avenue, Italian daily Corriere della Sera reported on Saturday. The deal could help the French luxury group cut its debt, which ballooned to more than 10 billion euros ($11.58 billion) in 2024, following a series of expensive acquisitions. Among them was the 18th century property in Via Montenapoleone, which the French group bought from Blackstone for 1.3 billion euros in April last year. Corriere said Kering was looking at selling a majority stake in the company through which it owns the building, based on a "similar valuation". It added that the buyer would be a vehicle linked to former Qatari Prime Minister and real estate billionaire Hamad bin Jassim bin Jaber Al-Thani. Kering declined to comment on the report. It was not immediately possible to contact Al-Thani for a comment. In April, when Corriere first reported about a possible Qatari-Kering deal for the Via Montenapoleone property, the Qatar Investment Authority denied it had any interest. Kering, which appointed former Renault CEO Luca de Meo to lead the group from September, is under pressure to trim debt and revive declining sales, particularly at its top brand Gucci. ($1 = 0.8633 euros) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
