Thinking about investing in artificial intelligence (AI)? Sometimes, that sounds like betting on super risky tech startups with stock prices that jump around like crazy. But for Canadian investors who want to get into AI without that rollercoaster ride, there’s a more steady option: CGI (TSX:GIB.A). This AI stock does IT and consulting and offers a stable way to be part of the AI world, mixing new tech with a history of doing well.
Long-term strength
CGI isn’t some brand-new company chasing the latest AI fad. It was started way back in 1976. Over all those years, it’s built a solid name for giving reliable IT services and consulting help. It hasn’t been shouting about AI, but it has been quietly adding the services it offers. This has made its services better without taking on too much of the risk that comes with being a pure AI stock. It’s a more careful approach.
CGI’s financial situation is on firm ground. In the first three months of its 2025 fiscal year, the AI stock reported revenue of $3.79 billion. That’s a nice 5.1% increase from the year before. Its net earnings went up to $438.6 million, which is a 12.5% jump. And the earnings per share reached $1.92, a 15% increase. These numbers show that CGI can keep growing at a steady pace while also making a good profit.
Beyond just the numbers, the way CGI is making moves shows it’s focused on growth that lasts. The AI stock reported new business bookings of $4.16 billion in that same quarter. That resulted in a book-to-bill ratio of 109.8%. So, for every dollar of revenue it recognized, it booked almost $1.10 of new business. Plus, the backlog stood at a hefty $29.76 billion.
More to come
CGI’s way of dealing with AI is pretty sensible. Instead of throwing money at unproven AI technologies, it’s adding AI to the services it already offers. This makes those services more efficient and gives real, noticeable benefits to its clients. For investors, this means you can get exposure to the potential of AI without the crazy ups and downs you often see with companies that are only focused on AI. It’s a more balanced way to invest in this area.
What’s also good to see is that CGI’s financial health is strong. Its net debt compared to its total capital is a low 13.7%. And the cash it generated from its operations reached $646.4 million in the first quarter of fiscal 2025. This means the AI stock has the financial flexibility to invest in new growth opportunities while keeping a solid financial foundation. It’s got the resources it needs to grow without taking on too much debt.
So, if you’re thinking about investing in AI but don’t want to jump into the deep end of the unpredictable tech sector, CGI offers a more balanced option. Its consistent financial performance, its smart way of integrating AI into its services, and its focus on long-term growth make it a stock worth considering for cautious investors who still want to be part of the AI story. It’s a more grounded way to get into this exciting technology.
Bottom line
CGI’s hands-on approach can lead to long-lasting client relationships and recurring revenue. The AI stock’s global presence provides diversification across different markets and economies. CGI’s focus on specific industries like healthcare, finance, and government means it has deep expertise in areas where AI is increasingly being adopted. This industry-specific knowledge can be a significant advantage. Overall, CGI’s steady growth and profitability provide a solid foundation for long-term investment returns. It’s not just about the hype of AI but about building a sustainable business around it.
