Under-the-radar Canadian stock, CGI Inc. (TSX: GIB.A) has been around for decades. Yet this Canadian company is rarely mentioned and often overlooked in stock market discourse. But what is CGI, and why is this Canadian stock worth paying attention to? Let’s take a look at the answer to these questions.
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A Canadian information technology leader
CGI, the stock, has flown under the radar. Simply put, investors and headlines have not given CGI the respect and attention it deserves. But CGI, the company, is well-known in the technology world. Its top-notch reputation has enabled it to rise to become one of the largest global IT and business consulting firms.
This Canadian company has been an example of prudent growth, disciplined capital allocation, and operational and financial excellence. I’m not sure why it falls under the radar amongst investors, but I know that an ignored high-quality stock means less demand for the stock and hence, an attractive valuation. This is the case for CGI.
In 2018, CGI’s revenue came in at $11.5 billion. In 2022, it came in 12% higher at $12.9 billion. Most recently, revenue came in at $15.9 billion in 2025. Today, CGI stock is trading at 11 times this year’s earnings estimate and 2 times book value — an inexpensive valuation given CGI’s fundamental and financial performance. Of course, it is this performance that has led to CGI’s strong return on equity of close to 20% and its double-digit earnings growth rates, illustrating the value of this Canadian company.
Latest results
The Canadian company’s latest results have once again displayed consistency, excellence, and strong growth. CGI’s third quarter of fiscal 2026 saw the company post revenue of $4.2 billion and strong bookings and backlog. In fact, backlog of $38.1 billion is equal to nine times the company’s quarterly revenue.
Moving farther down the income statement, we have the earnings before interest and taxes (EBIT) line. CGI’s EBIT came in 2.3% higher, at $682 million in the quarter, for an EBIT margin of 16.3%. This margin has consistently increased and now compares to a margin of less than 10% many years ago. This is evidence of continuous and steady improvement.
CGI’s stock price
Let’s take a look at CGI’s stock price performance over the long term. CGI’s long-term price graph shows that CGI stock’s rise could be characterized as a controlled and steady rise without too much volatility.
Well, except since 2025, when CGI’s stock price came under intense pressure and started selling off. In fact, it’s down 35% from its 2025 highs as client spending has been delayed and as artificial intelligence (AI) has threatened to disrupt traditional consulting demands.
In response to the changing landscape, CGI has worked hard on incorporating AI into its offerings. At this time, $10 billion of CGI’s pipeline has AI embedded in its offerings. The proof that CGI’s services are still in demand is found in its backlog and bookings numbers.
As previously mentioned, CGI’s backlog is strong. And its bookings keep growing. Bookings in the quarter were $4.2 billion, resulting in a book-to-bill ratio of 100%. This measures new orders received versus orders billed. In the trailing 12-month period, CGI’s book-to-bill ratio was 108%. This means that demand is growing.
The bottom line
This Canadian company must deal with the changes brought about by AI. And it must adapt to continue to be successful. Looking at the CGI’s recent bookings and backlog it appears that CGI’s is adapting well in this new environment. Yet, CGI’s stock price is extremely cheap, and it continues to be ignored. I think this is a great opportunity to consider buying.
