CGI Inc. (GIB): A Bull Case Theory

CGI Inc. provides accusation exertion and concern process services successful Western and Southern Europe, the United States, Canada, Scandinavia, Northwest and Central-East Europe, the United Kingdom, Australia, Germany, Finland, Poland, Baltics, and the Asia Pacific. GIB delivered a beardown Q4/25 performance, demonstrating the dependable execution and disciplined superior allocation that specify its semipermanent compounding model.

Revenue roseate 9.7% year-over-year, portion adjusted EPS accrued 10.9%, highlighting the company’s quality to turn profitably adjacent arsenic IFRS margins were temporarily distorted by restructuring costs. Bookings were peculiarly robust astatine $4.79 billion, translating to a 119% book-to-bill ratio, underscoring sustained lawsuit request and the increasing interaction of AI-embedded managed services. The backlog reached $31.45 billion, adjacent to 2 years of revenue, providing a wide enactment of show to maturation implicit the adjacent 24–36 months.

Management’s disciplined approach—combining backlog, strategical M&A of $1.8 billion, and assertive buybacks totaling $1.275 billion—continued to present shareholder value. The institution besides raised its dividend by 13%, signaling confidence successful aboriginal currency flows. AI and managed services remain the superior maturation engine, driving efficiencies, higher-margin work, and lawsuit renewals. Margins are normalizing present that restructuring is complete, portion escaped currency flow remains elite astatine 16.5% of revenue. Despite marketplace headwinds and short-term perception challenges, CGI maintains a high-quality recurring gross base, heavy lawsuit relationships, and a systematic M&A strategy that has historically proven accretive.

Valuation metrics, including a PE ratio of 16—levels past seen successful 2014 and 2020—combined with a 13.6% instrumentality connected invested capital, suggest the banal is attractively priced comparative to its semipermanent potential. With a beardown equilibrium sheet, predictable currency generation, and ongoing buybacks, CGI represents a classical BTSX-27 compounder. The company’s accordant execution and resilient concern exemplary marque it a compelling buy-to-equal-weight opportunity, offering constricted downside and important upside should AI adoption further accelerate its growth.