Deep Dive - AI versus VMS: investors throwing the baby out with the bathwater

In the financial world, the line between healthy caution and irrational panic is often razor thin. Currently, the Vertical Market Software (VMS) sector finds itself at the epicenter of such a storm. As investors dump their shares of serial acquirers Constellation Software (Toronto: CSU), Topicus (Toronto: TOI), and to a lesser extent Chapters Group (Frankfurt: CHG) and Asseco Poland (Warsaw: ACP), we see a classic scenario in which the baby is being thrown out with the bathwater. The market seems to have already passed its verdict, with artificial intelligence (AI) dealing the death blow to niche software. However, we believe these fears are grossly exaggerated.