A Tax-Free Savings Account (TFSA) doesn’t need a stock promising to reinvent civilization before lunch. A business getting paid to solve problems can do plenty of useful work for your savings. The growth may attract fewer fireworks, but earnings that reach each share can compound just as effectively. I’d look for established customer relationships, sensible capital allocation, and a price that doesn’t demand a perfect future.
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Start with the paying customer
Businesses and governments need technology that works with systems they already have. That means connecting software, maintaining secure operations, and updating services without disrupting customers or employees. Artificial Intelligence (AI) adds opportunity, but it also adds implementation work. A company can earn from the change by helping clients use the technology effectively, instead of depending on inventing the next dominant model.
CGI (TSX: GIB.A) operates in that practical part of the market. It provides consulting, systems integration, and managed technology services. Existing relationships give it knowledge of clients’ systems and obligations, which can make it useful when those clients modernize. The investment case starts with getting paid for that work and keeping enough profit to reward shareholders.
Growth reaches each share
CGI’s fiscal third-quarter adjusted earnings per share (EPS) rose 9% to $2.29. Total adjusted earnings grew more slowly, showing that changes in the share count helped the per-share result. That’s worth understanding because shareholders own a fraction of the business. A smaller pool of shares can give each remaining owner a larger claim on profits without requiring revenue to grow at a spectacular pace.
The company’s capital disclosures show Class A shares outstanding declining between January and July. The table below captures the net change, which includes the effects of repurchases and any share issuance during the period.
| CLASS A SHARE COUNT | SHARES OUTSTANDING |
|---|---|
| January 23, 2026 | 190,635,136 |
| July 24, 2026 | 182,952,649 |
| Net reduction | 7,682,487 |
That’s roughly 4% fewer Class A shares. I’d welcome continued repurchases when the price makes sense, while wanting the operating business to keep earning more too. Buying back shares can strengthen growth per share, but it works best alongside useful services and healthy client relationships. Those clients still need to see value when their own spending budgets become tighter.
The price leaves room to work
Using the recent close of $115.32, the shares trade at about 12.6 times earnings. That’s a simple earnings-run-rate comparison, giving a starting valuation without assuming the next quarter suddenly accelerates. It makes the business more interesting to me than a speculative stock requiring a distant breakthrough before it earns meaningful money.
CGI also pays a small quarterly dividend of $0.17. The payment isn’t the main reason I’d buy it. I’d want most of the return to come from business progress and sensible repurchases, with the dividend offering a little income along the way. That leaves room to invest in useful capabilities.
Clients can delay projects when budgets tighten, and AI can change the amount of labour required for some services. CGI needs to capture productivity gains and win new work without giving all the benefit away through lower prices. Acquisitions bring another demand on capital, so I’d favour disciplined integration over growth pursued simply to make the company larger.
Bottom line
A TFSA can shelter future gains, but it doesn’t turn a permanent investment loss into new contribution room. I’d make CGI one holding among several businesses and leave emergency savings outside the market. The attraction is a practical earnings engine that can keep improving, with enough diversification to let that improvement take time.
I’d buy CGI gradually for a long-term account. Paying clients and rising per-share earnings give the investment a useful foundation, while the current valuation leaves more room for ordinary progress to reward shareholders. Building a Canadian stock portfolio around businesses like that can make tomorrow’s growth depend more on execution and less on a lucky guess.
