CGI Group (NYSE:GIB) Announces Earnings Results

CGI Group (NYSE:GIB) (TSE:GIB.A) announced its quarterly earnings results on Wednesday. The technology company reported $1.65 EPS for the quarter, hitting analysts’ consensus estimates of $1.65, Zacks reports. The business had revenue of $2.99 billion for the quarter, compared to analysts’ expectations of $3.05 billion. CGI Group had a return on equity of 18.72% and a net margin of 10.26%.The business’s quarterly revenue was up 3.3% on a year-over-year basis. During the same period in the previous year, the firm earned $2.12 EPS.

Here are the key takeaways from CGI Group’s conference call:

• Record bookings and backlog — Q2 bookings were CAD 4.3B (book‑to‑bill 104%), trailing‑12‑month bookings reached a record CAD 18B, and contracted backlog is CAD 31.5B with ~CAD 12B expected to be recognized in the next 12 months.
• Strong profitability and cash generation — adjusted EBIT was CAD 692M (16.6% margin), adjusted EPS rose to CAD 2.27 (+7.1% YoY), Q2 cash from operations was CAD 451M and trailing‑12‑month cash is CAD 2.5B; the company returned CAD 397M via buybacks and declared a CAD 0.17 quarterly dividend.
• AI strategy and M&A accelerating demand — management emphasized an “AI‑first” approach (DigiOps, IP integrations), expanded partnerships with AWS/OpenAI/Google and others, and completed the Stratfield acquisition to strengthen AI/consulting capabilities while pipeline opportunities are up >180%.
• Near‑term regional headwinds and costs — decision‑making delays affected U.S. Federal and parts of Europe (Nordics/Finland) and manufacturing demand in Germany is softening; acquisition/integration costs of CAD 41M and a new French corporate surcharge raised the expected effective tax rate to ~26%–27%.

CGI Group Trading Up 1.7%

Shares of GIB traded up $1.09 during mid-day trading on Friday, hitting $66.53. 604,383 shares of the company’s stock traded hands, compared to its average volume of 489,221. The company has a quick ratio of 0.70, a current ratio of 0.94 and a debt-to-equity ratio of 0.28. CGI Group has a 1 year low of $61.90 and a 1 year high of $110.07. The firm has a market capitalization of $14.29 billion, a P/E ratio of 12.01 and a beta of 0.58. The business’s 50-day moving average price is $72.88 and its 200-day moving average price is $82.66.

CGI Group Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, June 19th. Stockholders of record on Friday, May 15th will be paid a dividend of $0.17 per share. The ex-dividend date of this dividend is Friday, May 15th. This represents a $0.68 annualized dividend and a dividend yield of 1.0%. CGI Group’s payout ratio is 8.66%.

Institutional Investors Weigh In On CGI Group

Hedge funds have recently made changes to their positions in the company. Strive Financial Group LLC bought a new stake in shares of CGI Group during the fourth quarter valued at approximately $37,000. EverSource Wealth Advisors LLC boosted its position in shares of CGI Group by 53.3% during the second quarter. EverSource Wealth Advisors LLC now owns 1,452 shares of the technology company’s stock valued at $152,000 after purchasing an additional 505 shares in the last quarter. Entropy Technologies LP bought a new stake in shares of CGI Group during the third quarter valued at approximately $236,000. AQR Capital Management LLC bought a new stake in shares of CGI Group during the first quarter valued at approximately $347,000. Finally, Danske Bank A S bought a new stake in shares of CGI Group during the third quarter valued at approximately $768,000. 66.68% of the stock is currently owned by institutional investors.

Analyst Ratings Changes

A number of equities analysts have commented on the company. Royal Bank Of Canada cut CGI Group from an “outperform” rating to a “sector perform” rating and decreased their price target for the stock from $150.00 to $100.00 in a research note on Thursday. TD Securities raised CGI Group to a “strong-buy” rating in a research note on Wednesday, January 28th. UBS Group dropped their price objective on CGI Group from $79.00 to $70.00 and set a “neutral” rating for the company in a report on Thursday. Weiss Ratings lowered CGI Group from a “hold (c-)” rating to a “sell (d+)” rating in a research report on Friday, March 27th. Finally, Scotiabank initiated coverage on CGI Group in a research note on Tuesday, January 27th. They set a “sector perform” rating on the stock. One analyst has rated the stock with a Strong Buy rating, five have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company presently has a consensus rating of “Hold” and an average target price of $83.67.

About CGI Group

CGI Group Inc is a global information technology and business consulting firm that delivers a broad range of services including IT consulting, systems integration, application development and maintenance, infrastructure and network services, managed IT and business process outsourcing. The company works with clients to design, build and operate IT systems and business solutions, with capabilities spanning cloud and hybrid IT environments, cybersecurity, data analytics and artificial intelligence, digital transformation and enterprise resource planning implementations.

Founded in 1976 in Quebec by Serge Godin and André Imbeau, CGI has grown from a regional systems integrator into a multinational professional services organization.