CGI Is Fast Off the Blocks With Strong Start to Fiscal 2023; Shares Fairly Valued

We are maintaining our CAD 119 fair value estimate for narrow-moat CGI after the firm reported strong financial results to kick off fiscal 2023. We continue to have a favorable view of the firm's business pipeline and fundamentals. We believe that CGI's ability to deliver strong financial results during a time of macro uncertainty demonstrates the strong switching costs and intangible assets the firm has built up over time. With shares trading around CAD 120, up 5% as of Feb. 1, we believe the market has finally calibrated its valuation to reflect the underlying strength of CGI&'s business that we have been highlighting for the past few quarters.