CGI Group (GIB) Stock Forecast & Price Target

CGI demonstrates a robust financial outlook with increasing earnings per share (EPS) estimates, projecting $8.36 for FY25 and $9.15 for FY26, reflecting a consistent upward trend. The company's strategic build-and-buy model effectively balances organic growth and acquisitions, supported by a 2% year-over-year growth in systems integration and consulting bookings, alongside a notable increase in backlog, which reached a record $29.8 billion, up 12% year-over-year. Furthermore, strong financial performance indicators, with net income margins expected to rise from 11.9% in CY24 to 12.5% in CY26, underscore CGI's growth potential in a healthy sales pipeline that saw a 20% year-over-year increase.

CGI experienced a sequential decline in organic growth, dropping to -1.1% year-over-year, which was significantly below the expected forecast of 0.5%. The company's EBIT margins decreased to 13.2%, falling short of the anticipated 13.5%, largely attributed to the challenges in integrating Aeyon. Additionally, the decline in organic growth in Europe to -0.8% raises concerns amidst ongoing macro and geopolitical uncertainties, further intensifying the negative outlook for CGI's stock.