DB:CJ5A

Stock Analysis Report

Executive Summary

CGI Inc., together with its subsidiaries, provides information technology (IT) and business process services in Canada, Northern Europe, France, the United States, the United Kingdom, Europe, and the Asia Pacific.


Snowflake Analysis

Flawless balance sheet and slightly overvalued.


Similar Companies

Share Price & News

How has CGI Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CJ5A has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.2%

CJ5A

9.2%

DE IT

0.07%

DE Market


1 Year Return

24.4%

CJ5A

6.9%

DE IT

14.8%

DE Market

Return vs Industry: CJ5A exceeded the German IT industry which returned 8.7% over the past year.

Return vs Market: CJ5A exceeded the German Market which returned 17.1% over the past year.


Shareholder returns

CJ5AIndustryMarket
7 Day0.2%9.2%0.07%
30 Day9.2%13.4%1.4%
90 Day4.1%15.0%6.1%
1 Year24.4%24.4%7.5%6.9%18.4%14.8%
3 Year41.5%41.5%146.9%140.0%17.4%7.0%
5 Year157.3%157.3%230.4%217.0%27.9%10.4%

Price Volatility Vs. Market

How volatile is CGI Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is CGI Group undervalued compared to its fair value and its price relative to the market?

20.93x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: CJ5A (€56.71) is trading above our estimate of fair value (€47.51)

Significantly Below Fair Value: CJ5A is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: CJ5A is good value based on its PE Ratio (20.9x) compared to the IT industry average (31.5x).

PE vs Market: CJ5A is poor value based on its PE Ratio (20.9x) compared to the German market (20.6x).


Price to Earnings Growth Ratio

PEG Ratio: CJ5A is poor value based on its PEG Ratio (3.2x)


Price to Book Ratio

PB vs Industry: CJ5A is good value based on its PB Ratio (3.5x) compared to the DE IT industry average (4.4x).


Next Steps

Future Growth

How is CGI Group forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

6.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CJ5A's forecast earnings growth (6.6% per year) is above the savings rate (0.2%).

Earnings vs Market: CJ5A's earnings (6.6% per year) are forecast to grow slower than the German market (13.2% per year).

High Growth Earnings: CJ5A's earnings are forecast to grow, but not significantly.

Revenue vs Market: CJ5A's revenue (3% per year) is forecast to grow slower than the German market (4.8% per year).

High Growth Revenue: CJ5A's revenue (3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CJ5A's Return on Equity is forecast to be low in 3 years time (16.9%).


Next Steps

Past Performance

How has CGI Group performed over the past 5 years?

8.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: Insufficient data to determine if CJ5A has high quality earnings.

Growing Profit Margin: Insufficient data to determine if CJ5A's profit margins have improved over the past year.


Past Earnings Growth Analysis

Earnings Trend: CJ5A's earnings have grown by 8% per year over the past 5 years.

Accelerating Growth: CJ5A's earnings growth over the past year (11.8%) exceeds its 5-year average (8% per year).

Earnings vs Industry: CJ5A earnings growth over the past year (11.8%) underperformed the IT industry 16.1%.


Return on Equity

High ROE: CJ5A's Return on Equity (16.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is CGI Group's financial position?


Financial Position Analysis

Short Term Liabilities: CJ5A's short term assets (CA$3.7B) exceed its short term liabilities (CA$3.3B).

Long Term Liabilities: CJ5A's short term assets (CA$3.7B) exceed its long term liabilities (CA$2.7B).


Debt to Equity History and Analysis

Debt Level: CJ5A's debt to equity ratio (31.5%) is considered satisfactory.

Reducing Debt: CJ5A's debt to equity ratio has reduced from 73% to 31.5% over the past 5 years.

Debt Coverage: CJ5A's debt is well covered by operating cash flow (67.5%).

Interest Coverage: CJ5A's interest payments on its debt are well covered by EBIT (30.1x coverage).


Balance Sheet

Inventory Level: CJ5A has a low level of unsold assets or inventory.

Debt Coverage by Assets: CJ5A's debt is covered by short term assets (assets are 1.7x debt).


Next Steps

Dividend

What is CGI Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.5%industryaverage0.5%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate CJ5A's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate CJ5A's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CJ5A's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CJ5A's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CJ5A's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

What is the CEO of CGI Group's salary, the management and board of directors tenure and is there insider trading?

4.1yrs

Average management tenure


CEO

George Schindler (55yo)

2.3yrs

Tenure

CA$8,568,137

Compensation

Mr. George D. Schindler has been the Chief Executive Officer, President and Director at CGI Group Inc. since October 1, 2016. Mr. Schindler served as the Chief Operating Officer at CGI Group Inc. since May ...


CEO Compensation Analysis

Compensation vs Market: George's total compensation ($USD6.52M) is above average for companies of similar size in the German market ($USD4.52M).

Compensation vs Earnings: George's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.1yrs

Average Tenure

61.5yo

Average Age

Experienced Management: CJ5A's management team is considered experienced (4.1 years average tenure).


Board Age and Tenure

10.3yrs

Average Tenure

67yo

Average Age

Experienced Board: CJ5A's board of directors are seasoned and experienced ( 10.3 years average tenure).


Insider Trading

Insider Buying: CJ5A insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Sell€1,574,43814 Nov 19
Serge Godin
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman of the Board
Shares21,769
Max Price€72.32
Buy€199,48109 Aug 19
Alison Reed
EntityIndividual
Shares3,000
Max Price€66.49
Sell€4,439,06127 Feb 19
Michael Roach
EntityIndividual
Role
Member of the Board of Directors
Director
Shares74,800
Max Price€59.59
Sell€2,695,79126 Feb 19
Michael Roach
EntityIndividual
Role
Member of the Board of Directors
Director
Shares45,600
Max Price€59.21
Sell€5,884,21125 Feb 19
Michael Roach
EntityIndividual
Role
Member of the Board of Directors
Director
Shares99,600
Max Price€59.19
Sell€1,152,32322 Feb 19
Paule Doré
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares19,660
Max Price€58.70
Buy€666,72714 Feb 19
Michael Pedersen
EntityIndividual
Shares11,350
Max Price€58.81

Ownership Breakdown

Dilution of Shares: Insufficient data to determine if shareholders have been diluted in the past year.


Management Team

  • Serge Godin (69yo)

    Founder & Executive Chairman of the Board

    • Tenure: 13yrs
    • Compensation: CA$13.88m
  • André Imbeau (68yo)

    Co-Founder & Director

    • Tenure: 43yrs
  • François Boulanger

    Executive VP & CFO

    • Tenure: 4.3yrs
    • Compensation: CA$2.93m
  • Lorne Gorber

    Executive Vice-President of Investor & Public Relations

    • Tenure: 4yrs
  • George Schindler (55yo)

    President

    • Tenure: 2.3yrs
    • Compensation: CA$8.57m
  • Benoit Dubé

    Executive VP

    • Tenure: 8.5yrs
  • Julie Godin (43yo)

    Vice-Chair of the Board

    • Tenure: 2.4yrs
  • Jean-Michel Baticle

    President of Western & Southern Europe Operations

    • Compensation: CA$2.25m
  • Dave Henderson

    President of United States Operations

    • Tenure: 1.1yrs
    • Compensation: CA$2.20m
  • Stuart Forman

    Senior VP & Global Chief Information Officer


    Board Members

    • Michael Roach (66yo)

      Director

      • Tenure: 12.5yrs
      • Compensation: CA$215.00k
    • Serge Godin (69yo)

      Founder & Executive Chairman of the Board

      • Tenure: 13yrs
      • Compensation: CA$13.88m
    • André Imbeau (68yo)

      Co-Founder & Director

      • Tenure: 43yrs
    • Paule Doré (67yo)

      Independent Director

      • Tenure: 24yrs
      • Compensation: CA$235.00k
    • Bernard André Bourigeaud (74yo)

      Independent Director

      • Tenure: 10.3yrs
      • Compensation: CA$281.60k
    • Alain Bouchard (69yo)

      Independent Director

      • Tenure: 5.7yrs
      • Compensation: CA$235.00k
    • George Schindler (55yo)

      President

      • Tenure: 2.3yrs
      • Compensation: CA$8.57m
    • Gilles Labbé (62yo)

      Independent Director

      • Tenure: 9yrs
      • Compensation: CA$235.00k
    • Julie Godin (43yo)

      Vice-Chair of the Board

      • Tenure: 2.4yrs

    Company Information

    CGI Inc.'s company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: CGI Inc.
    • Ticker: CJ5A
    • Exchange: DB
    • Founded: 1976
    • Industry: IT Consulting and Other Services
    • Sector: Software
    • Market Cap: CA$23.497b
    • Listing Market Cap: CA$15.603b
    • Shares outstanding: 273.47m
    • Website: https://www.cgi.com

    Number of Employees


    Location

    • CGI Inc.
    • 1350 René-Lévesque Boulevard West
    • 15th Floor
    • Montreal
    • Quebec
    • H3G 1T4
    • Canada

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    GIBNYSE (New York Stock Exchange)YesClass A SharesUSUSDAug 1988
    GIB.ATSX (The Toronto Stock Exchange)YesClass A SharesCACADAug 1988
    CJ5ADB (Deutsche Boerse AG)YesClass A SharesDEEURAug 1988

    Biography

    CGI Group Inc., together with its subsidiaries, provides information technology (IT) and business process services in Canada, Northern Europe, France, the United States, the United Kingdom, Europe, and the Asia Pacific. Its services include the management of IT and business outsourcing, systems integration and consulting, and software solutions selling activities. CGI Group Inc. also offers application development, management, testing, portfolio management, and modernization services; business consulting, including agile, business transformation, change management, CIO advisory, cybersecurity, data analytics, digital enterprise, project management, and industry-specific services; and a suite of business process services designed to address the needs of specific industries, as well as IT infrastructure consulting, solutions, and services. The company serves clients operating in government, financial services, health, utility, communication, oil and gas, manufacturing, retail and consumer service, transportation, and post and logistics sectors. CGI Group Inc. was founded in 1976 and is headquartered in Montreal, Canada. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2019/01/31 22:41
    End of Day Share Price2019/01/30 00:00
    Earnings2018/12/31
    Annual Earnings2018/09/30


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.