“CGI is relatively unique among peers with arguably one of the most well-balanced and well-diversified offerings,” said Jefferies analysts, led by Surinder Thind, in a Tuesday note. “Roughly half of revenues come from consulting and the other half from managed services. Similarly, roughly half of revenues come from North America and the other half from Europe.”
Jefferies set a price target of $120 on the stock, which is 21% higher than its last closing price.
“CGI is on pace to grow revenues between +1-2% in F2024, which we believe likely marks a low point,” Thind said. “For F2025, we expect revenue growth to accelerate to +4% y/y cc, up from +1% y/y cc in F2024. We assume modest improvement in end client demand for consulting, and continued solid growth in managed services.”
“While our F2025 estimates are mostly in line with consensus, we are well ahead for F2026 on revenue growth of +7% y/y cc (+300 bps vs consensus) and adj EPS of $9.28 CAD (+5% vs consensus),” Thind added.
CGI has a Hold rating from Seeking Alpha analysts, but a Buy rating from Wall Street. It has a Hold rating from Seeking Alpha’s Quant system, which routinely beats the market.