One-glance verdict
Undervalued
$185.06 our estimate vs market $79.29
Wall Street consensus: $81.98 (-55.7% lower than our fair-value estimate)
57% below our estimate, below the bear case
Fundamentals snapshot
CGI Inc.
GIB · NYQ · Technology · Information Technology Services
Current price
$79.29
52-week range
$59.63 - $95.20
Market cap
$16.42B
Balance sheet
Watch
21.94x Strong cushion
Net debt $2.73B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 8.4% last year.
- Reward Returns 17.0% on equity, ahead of 33% of its peers.
- Risk Net debt grew 16.4% over 3 years.
- Risk Operating margin compressed from 16.2% to 16.2% over 3 years.
What this company does
CGI Inc.
CGI Inc. helps businesses and governments use technology and manage their daily operations by offering services like IT consulting and managing software applications. Most of their money comes from long-term contracts for these services, which is good because it means they have a steady income stream rather than just one-off sales. This stability is important because it allows them to plan for the future and keep investing in their services to help clients adapt to new technology.
How the company got here
CGI was started in 1976 in Quebec, Canada, by two founders in a basement with a single phone. Initially, it focused on IT consulting, but as businesses began to need more technology help, CGI expanded. A key part of its growth has been a "Build and Buy" strategy, meaning it grows by getting new clients and by acquiring other companies. Major turning points include acquiring Bell Sygma in 1998, which doubled its size, and the transformative purchase of Logica in 2012, which made it one of the top five independent IT and business consulting firms globally.
What it actually does
CGI helps other businesses and governments with their technology needs. Think of it as a technology and business consulting firm that companies hire to improve their computer systems and business processes. This can range from offering strategic advice and integrating new software to managing a company's entire IT department (a service known as outsourcing, where a company hires another to handle specific tasks). They serve a wide variety of industries, including government, banking, healthcare, and manufacturing.
Managed IT and Business Process Services
This is CGI's largest business area, making up more than half of its revenue. In this segment, CGI takes over and manages a client's technology operations or specific business tasks on a long-term basis. This could involve running a company's data centers, managing their cybersecurity (protecting computer systems from theft or damage), or handling customer service and billing. Companies pay CGI for these ongoing services to make their own operations more efficient and to gain access to CGI's expertise.
Systems Integration and Consulting
This part of the business focuses on specific projects to build, develop, and implement new technology solutions for clients. For example, a company might hire CGI to create a new mobile app, modernize their outdated software, or help them move their data to the cloud (storing and accessing data over the internet instead of on a local computer). This segment also includes providing strategic advice to help businesses plan their technology investments and digital transformation (the process of adopting digital technology to change how a business operates).
What management is betting on now
CGI is currently focused on helping its clients with digital transformation, which involves using modern technology to improve how they operate and serve their customers. A big part of this is artificial intelligence (AI), where they help companies use AI to analyze data and automate tasks. They are also emphasizing cybersecurity, cloud computing, and helping clients modernize their older technology systems to become more efficient and competitive. The company's strategy is to work closely with clients in their local areas, building long-term relationships to provide these services.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $185.06 vs current price $79.29
Wall Street consensus is the average analyst price target: $81.98 (-55.7% lower than our fair-value estimate).
Our most-likely fair value is $185.06 a share — about 133.4% above today's price of $79.29, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Watch
Net debt $2.7B. Interest coverage 21.9x.
Net debt
$2.73B
Interest coverage
21.94x
CGI Inc.'s profit covers its interest bill about 21.9 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
GIB
BASELINE
CGI Inc.
Total debt $3.18B Interest coverage 21.94x This is the baseline the peer rows are being compared against.
Total debt $13.40B Interest coverage 47.43x +116% vs GIB Carries about 2.2x more debt cushion than GIB.
Total debt $2.09B Interest coverage 89.92x +310% vs GIB Carries about 4.1x more debt cushion than GIB.
Total debt $923.00M Interest coverage 87.00x +296% vs GIB Carries about 4.0x more debt cushion than GIB.
Total debt $4.17B Interest coverage 1.39x -94% vs GIB Carries about 15.8x less debt cushion than GIB.
Total debt $4.16B Interest coverage 4.97x -77% vs GIB Carries about 4.4x less debt cushion than GIB.
What you should know
The case for and against GIB
3 Rewards
2 Risks
Rewards
-
Revenue grew 8.4% last year.
-
Returns 17.0% on equity, ahead of 33% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Net debt grew 16.4% over 3 years.
-
Operating margin compressed from 16.2% to 16.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
13.62x
Forward P/E
11.44x
P/B
2.26x
P/S
1.00x
EV/EBITDA
6.85x
PEG ratio
0.94x
Profitability
How much profit each dollar creates
Gross margin
20.4%
Operating margin
16.2%
Net margin
10.5%
ROE
17.0%
ROA
8.7%
Health
Liquidity and balance-sheet strength
Debt / equity
0.44x
Current ratio
0.94x
Quick ratio
0.69x
Total debt
$3.18B
Total cash
$450.90M
Growth
How the business has been compounding
Revenue TTM
$11.70B
Revenue 5Y CAGR
7.3%
EPS TTM
5.82
EPS 5Y CAGR
6.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.59B
Free CF TTM
$1.40B
FCF margin
11.9%
Dividend
Shareholder payout
Yield
0.6%
Payout ratio
8.2%
Last ex-div date
2026-08-14