Morningstar

CGI Inc Class A GIB.A

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Stock XTSE Rating as of
CAD 156.01 −1.35 (0.86%)
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As of Delayed Price Closed

Company Report

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CGI's Short-Term Revenue Growth Is Slowing, but Our Long-Term View Is Unchanged

Malik Ahmed Khan

CGI is a leading global IT-services firm, catering a bit more to governmental agencies than its peers, providing managed IT, consulting, and intellectual property solutions. We believe that CGI benefits from strong switching costs and intangible assets, which lead us to assign the firm a narrow economic moat rating. Despite the macroeconomic headwinds, CGI has posted steady revenue due to long-term contracts with many of its clients. We think such stability will continue with the help of CGI’s switching costs and intangible assets, which both work to create stickiness among existing customers.

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Price vs Fair Value

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GIB.A is trading at a 195% premium.
Price
CAD 157.36
Fair Value
CAD 634.00
Uncertainty
Medium
1-Star Price
CAD 834.74
5-Star Price
CAD 83.20
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

CGI has an outsize presence in the government vertical, which could lead to further growth if government agencies place increasing importance on total investment in IT needs.

Bears

CGI's lower offshore leverage could affect its bottom line for years as it remains at a cost disadvantage to Indian competitors.

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News

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Trading Information

Previous Close Price
CAD 157.36
Day Range
CAD 155.68–158.00
52-Week Range
CAD 129.00–160.40
Bid/Ask
CAD 155.65 / CAD 157.60
Market Cap
CAD 35.56 Bil
Volume/Avg
247,731 / 340,605

Key Statistics

Price/Earnings (Normalized)
20.50
Price/Sales
2.53
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
3.36%

Company Profile

CGI is a Canada-based IT-services provider with an embedded position in North America and Europe. The company generates more than CAD 14 billion in annual revenue, employs over 90,000 personnel, and operates across 400 offices in 40 countries. CGI offers a broad portfolio of services such as consulting, systems integration, application maintenance, and business process services. Its largest vertical market is government, which contributes more than a third of group revenue.
Sector
Technology
Industry
Information Technology Services
Stock Style Box
Large Core
Total Number of Employees
91,500
Website
https://www.cgi.com

Competitors

Valuation

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Metric
GIB.A
ACN
INFY
Price/Earnings (Normalized)
 20.5030.4131.56
Price/Book Value
 4.037.999.32
Price/Sales
 2.533.544.97
Price/Cash Flow
 16.9019.9324.63
Price/Earnings
GIB.A
ACN
INFY

Financial Strength

Metric
GIB.A
ACN
INFY
Quick Ratio
 0.661.031.35
Current Ratio
 1.161.161.89
Interest Coverage
 26.62169.13—
Quick Ratio
GIB.A
ACN
INFY

Profitability

Metric
GIB.A
ACN
INFY
Return on Assets (Normalized)
 11.07%16.59%19.91%
Return on Equity (Normalized)
 20.38%35.29%33.00%
Return on Invested Capital (Normalized)
 14.84%27.22%30.02%
Return on Assets
GIB.A
ACN
INFY

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