CGI (TSE:GIB.A)
TSX:GIB.A
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CGI
(TSX:GIB.A)
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Rating:71Outperform
Price Target:
C$98.00
▼(-6.19% Downside)
Action:Reiterated
Date:05/01/26
The score is driven primarily by high-quality financials (strong profitability and free cash flow with manageable leverage) and a supportive earnings outlook with strong bookings/backlog and ongoing buybacks. These positives are tempered by weak technicals (price below all key moving averages and negative MACD) and only moderate valuation support, with a low dividend yield.
Positive Factors
Strong free cash flow generation
Sustained high operating and free cash flow provides durable internal funding for M&A, buybacks, dividends and investment in capabilities. Consistent cash conversion near net income supports financial flexibility and resilience through economic cycles, enabling strategic long-term decisions.
Negative Factors
SI&C trailing conversion weakness
SI&C conversion below 100% suggests the systems-integration pipeline is not converting into revenue at prior rates. Because SI&C often carries higher margin and drives new capability sales, persistent conversion weakness can slow organic revenue growth and pressure future margin expansion.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow generation
Sustained high operating and free cash flow provides durable internal funding for M&A, buybacks, dividends and investment in capabilities. Consistent cash conversion near net income supports financial flexibility and resilience through economic cycles, enabling strategic long-term decisions.
Read all positive factors
CGI (GIB.A) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$19.13B
Dividend Yield0.48%
Average Volume (3M)566.77K
Price to Earnings (P/E)12.1
Beta (1Y)0.51
Revenue Growth7.91%
EPS Growth-0.13%
CountryCA
Employees94,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)7.71
Shares Outstanding190,635,130
10 Day Avg. Volume857,925
30 Day Avg. Volume566,774
Financial Highlights & Ratios
PEG Ratio41.71
Price to Book (P/B)2.72
Price to Sales (P/S)1.76
P/FCF Ratio13.21
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$113.92Price Target Upside9.04% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)8.96
Revenue Forecast (FY)C$16.55B
CGI Business Overview & Revenue Model
Company Description
CGI Inc., together with its subsidiaries, provides information technology (IT) and business process services in Canada; Western, Southern, Central, and Eastern Europe; Australia; Scandinavia; Finland, Poland, and Baltics; the United States; the Un...
How the Company Makes Money
CGI makes money primarily by selling IT and business services to enterprise and government clients under a mix of time-and-materials, fixed-price, and long-term outsourcing/managed-services contracts. Key revenue streams typically include: (1) Con...
CGI Earnings Call Summary
Earnings Call Date:Jan 28, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Positive
The call conveyed a broadly positive operational and financial picture: revenue, bookings, backlog, cash generation, EPS and capital returns all showed solid gains while the company advanced its AI strategy and talent base. Challenges were largely intermittent and structural transition issues—notably the U.S. federal shutdown, some one-time charges, SI&C trailing conversion below 100% and slower enterprise infrastructure modernization for AI. Management expects sequential improvement through the year but flagged near-term geopolitical and federal funding lumpiness as risks.Positive Updates
Revenue Growth
Total revenue of CAD 4.1 billion, up 7.7% year-over-year (up 3.4% ex-foreign exchange). Growth was driven by acquisitions and continued demand in APAC.
Negative Updates
U.S. Federal Shutdown Impact
The U.S. federal shutdown weighed on the quarter: bookings and utilization were negatively impacted, causing temporary margin pressure in the U.S. Federal segment. Management highlighted ongoing volatility and the risk of near-term lumpiness if further shutdowns occur.
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue Growth
Total revenue of CAD 4.1 billion, up 7.7% year-over-year (up 3.4% ex-foreign exchange). Growth was driven by acquisitions and continued demand in APAC.
Read all positive updates
Company Guidance
The company guided to sequential improvement next quarter and “continuing improvement for the rest of the year” (with the caveat of U.S. federal shutdown risk), targeting improved organic constant‑currency growth and margin pickup versus the Q1 adjusted EBIT of $655M (16.1% margin, down 10 bps) and adjusted diluted EPS of $2.12 (+8% y/y); tax rate guidance is 26–27% (Q1 effective rate 26.3%), the Board approved an NCIB to repurchase up to 19 million shares through Feb 2027 and declared a quarterly cash dividend of $0.17/share (record Feb 18, payable Mar 20), and management reiterated it expects to remain very active in buybacks given $2.4B in available capital resources and a net debt leverage ratio of 1x—backed by strong bookings ($4.5B in Q1; book‑to‑bill 110%; trailing‑12‑month bookings ≈$18B, +12% y/y) and a $31.3B contracted backlog (1.9x revenue).CGI Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
78
Positive
Cash Flow
82
Very Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.34B | 15.91B | 14.68B | 14.30B | 12.87B | 12.13B |
| Gross Profit | 3.35B | 3.29B | 3.01B | 2.88B | 2.60B | 2.50B |
| EBITDA | 3.04B | 2.52B | 2.61B | 2.51B | 2.28B | 2.14B |
| Net Income | 1.68B | 1.66B | 1.69B | 1.63B | 1.47B | 1.37B |
Balance Sheet | ||||||
| Total Assets | 19.30B | 19.52B | 16.69B | 15.80B | 15.18B | 15.02B |
| Cash, Cash Equivalents and Short-Term Investments | 716.04M | 867.88M | 1.46B | 1.58B | 972.64M | 1.70B |
| Total Debt | 4.30B | 4.47B | 3.32B | 3.74B | 3.98B | 4.22B |
| Total Liabilities | 9.30B | 9.24B | 7.26B | 7.49B | 7.90B | 8.03B |
| Stockholders Equity | 10.00B | 10.28B | 9.43B | 8.31B | 7.27B | 6.99B |
Cash Flow | ||||||
| Free Cash Flow | 2.31B | 2.12B | 2.10B | 1.81B | 1.57B | 1.88B |
| Operating Cash Flow | 2.47B | 2.23B | 2.20B | 2.11B | 1.86B | 2.12B |
| Investing Cash Flow | -746.12M | -2.20B | -775.38M | -561.86M | -911.95M | -397.55M |
| Financing Cash Flow | -1.62B | -246.66M | -1.61B | -1.19B | -1.59B | -1.65B |
CGI Technical Analysis
Neutral
104.47
Price Trends
97.04
Negative
105.63
Negative
115.78
Negative
Market Momentum
-3.18
Positive
43.03
Neutral
46.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GIB.A, the sentiment is Neutral. The current price of 104.47 is above the 20-day moving average (MA) of 92.13, above the 50-day MA of 97.04, and below the 200-day MA of 115.78, indicating a bearish trend. The MACD of -3.18 indicates Positive momentum. The RSI at 43.03 is Neutral, neither overbought nor oversold. The STOCH value of 46.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:GIB.A.
CGI Peers Comparison
UnderperformOutperform
Sector (61)
TSE:GIB.A
CGI
90.87
-54.10
-37.32%
TSE:ALYA
Alithya Group
1.30
-0.44
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TSE:PVT
Pivotree
1.55
0.32
26.02%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.