Market News

CGI Q4 Profit Rises Sharply

CGI Group (GIB.A), one of the world’s largest IT and business consulting firms, posted a 37.3% rise in profit in its fourth quarter as revenue edged higher. (See Insiders’ Hot Stocks on TipRanks)

Revenue & Earnings

Revenue came in at C$3.01 billion in the three months ended September 30, an increase of 2.8% from C$2.93 billion in the prior-year quarter. Excluding currency effects, revenue increased 6.4% year-over-year.

profit amounted to C$345.9 million (C$1.39 per diluted share) in Q4 2021, up from C$251.9 million (C$0.96 per diluted share) in Q4 2020.

On an adjusted basis, profit was C$346.9 million (C$1.40 per diluted share), compared with a profit of C$318.4 million (C$1.22 per diluted share) a year earlier. CGI was expected to report an adjusted profit of C$1.35 per share.

CGI President and CEO George D. Schindler said, “CGI ended fiscal 2021 in a strong position, with accelerating revenue growth and a robust book of business and balance sheet. Looking to the year ahead, we will accelerate our investments in the talent and capabilities necessary to expand our services and global footprint in support of clients’ evolving digital transformations.”

Bookings amounted to C$2.92 billion in the fourth quarter of fiscal 2021, up 84% year-over-year and representing a book-to-bill ratio of 97.1%.

Wall Street’s Take

On October 28, RBC Capital analyst Paul Treiber reiterated a Buy rating on GIB.A with a price target of C$124. This implies 11.6% upside potential.

Overall, consensus on the Street is that GIB.A is a Moderate Buy based on three Buys and one Sell. The average CGI price target of C$124.25 implies an upside potential of 11.8% to current levels.

TipRanks’ Smart Score

GIB.A scores a 5 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock returns are likely to be in line with the overall market.

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