Peter Arender, CFACGI Group (A)GIB.A.TOBUYApr 21, 2004

It is a consulting business with lots in the US and with the US government. It is an AI casualty but he is not seeing the effect yet for this company or Accenture  He owns Accenture which is a similar business with a similar share price chart, but larger. He feels that if they can show that they can grow with AI you will see earnings go up as well as the stock price.

Has owned this since 2011. AI concerns hit markets mid-2025 which has decimated the entire sector, not just CGI. Organic growth has been negative the past year or so, hurt by the US government shut down last year. CGI project organic growth later this year. Europe is 45% of their revenues, but given the Middle East war their economy is soft. So, companies are delaying decisions on taking on projects. CGI trades under 10x forward PE. The market wants to see organic growth for shares to rise. Is holding. The selling is overdone.

His 12-month price target is $107.50. Celebrating its 50th anniversary! And it's a leader, competing so well with the big consultancy companies. Tough business in this environment, where the focus is less on consulting and more on hardware.

One of its businesses involves helping small- to medium sized companies manoeuvre through the AI stack. Thinks that's the way going forward.

Suspects it's just a lull in the business. Results were fine, very nice balance sheet. Great capital allocation. Always going to need consultants. 

Good time to look at it with its reasonable multiple. Sector's been hate-sold. Great acquirers. If AI implementation picks up, could be a good entry point.

Very heavy on human capital numbers, probably largest IT employer in the country. A US comparable would be ACN. All have been under pressure from threat of AI. He doesn't accept that argument as a death knell, but it probably has some merit. No strong organic growth.

As for large institutional ownership, it's a Quebec darling. La Caisse has a mandate to support Quebec-based companies, so it's probably the biggest owner.

The model is what makes this stock interesting. Big part of the business is long-term outsourcing contracts of 5 years or more. Very stable and recurring revenue, which is great. 

Seeing real adoption of its software -- companies still need to modernize their systems before they can fully adopt AI. That plays right into CGI's strength. Growth depends on the spending cycle turning.

He just can't see all software companies being out of business because of AI. The incumbent providers are going to use it as a tool. 

Oversold. Perhaps a good buying opportunity. Gemini can solve your efficiency problems a lot faster than a corporate firm, so there are fears on a name like this. AI transformation won't happen overnight. Consultants are incorporating AI themselves, and the market's missing that.

Does not benefit from the AI boom, so it's underperformed. The US government shutdown didn't help. Now, it's caught in the software selloff. If you bought this low, take some profits. The big question: Will AI take over software companies? Too soon to tell, but the sell-off is overbown.

Doesn't know that much about it, but the market is selling software company, but GIB had run up before 2025 started. Valuations have come down, but are now in line with the market. He is looking hard at this sector which has good business and stock prices that were too high before, but now offer decent entry points.

Consulting names have all pulled back on either AI or fundamentals. Earnings just the other day -- guided for a pretty good quarter. Not growing at the rate he's attracted to. He wants a double-digit rate, and this name grows at high singles on the bottom line (and using a lot of share buybacks to achieve that).

Half of its business is a consulting service and half is outsourcing contracts. She has owned for a long time and it has done well over that time. The price has pulled back because of a concern that AI may decrease the need for its services. It is actually implementing AI and can develop automation. It grows organically and through M&A in which it is very disciplined. She expects M&A to pick up. It is well valued.

Still likes it. Whole sector's had the overhang of whether AI will impact demand. Company doesn't think so, though may be a temporary lull while companies reassess. Expertise implementing AI to make processes more efficient. Backlog is up. Will still grow through M&A. Very strong balance sheet. Forward PE of less than 14x.

She'd be buying here.

Global. Big player in US, making a series of "metro market" acquisitions. A near-shoring strategy. Affected by US government shutdown, but so is everybody, and it's not a reason not to own. Pretty steady, stable grower. May be missing some of the sizzle that tech investors are looking for. Not rapid organic growth, more low-mid single digits.

No qualms owning. Take advantage of disinterest in an otherwise good company and buy when it's on sale. Very good long-term compounder over many decades; if you own it, definitely hold on.

Every client situation is different. For example, do these investors have their income needs taken care of or are they close to the edge? So he'll just answer from a stock perspective.

Stock hasn't been performing well. Great for a very long time. Does a lot of business with the US government, and some of that could be in question right now. Broken technically, all of the MAs are moving lower. If he'd owned it, he'd have been stopped out a long time ago.

If something isn't rallying in the middle of a bull market, there's usually an issue. He'd rather own a more productive asset. The question is whether you trade to silver? He's very bullish on silver long term (for a decade, and we're only 18 months in). At some point, there will be a correction in the precious metals.

He'd trade from GIB.A to "something else", and for a seniors couple that would be a dividend grower. If you still want precious metals, look at one of the more conservative names such as AEM.