Wells Fargo Downgrades CGI Group (GIB) to Market Perform; Federal Likely to Weigh on Bookings; Fairly Valued

Wells Fargo downgraded CGI Group (NYSE: GIB) from Outperform to Market Perform. Valuation range lowered from $24-25 to $20-22.

Wells analyst says, "We are downgrading the shares of CGI Group (GIB) after a strong run over the past two years and our belief that current valuation is fair given the current stage of the recovery. We believe GIB may report weakness in U.S. Federal bookings similar to its peers who have reported Q1 results to date (IBM (NYSE: IBM), Unisys (NYSE: UIS), and Lockheed Martin (NYSE: LMT)). We remain comfortable with our current estimates at this time but see limited upside potential due to the lingering Federal market headwinds, large contract loss grow over, and growing FX pressure. We continue to believe GIB is one of the best managed IT Services providers in the space and look forward to becoming more positive on the shares once again."

For more ratings news on CGI Group click here and for the rating history of CGI Group click here.

Shares of CGI Group closed at $21.48 yesterday.

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