CGI's NAV Lags Benchmark as Leverage Declines

Event summary

  • CGI's NAV per share at February 28, 2026 was $86.97, with YTD and 12-month returns of 8.2% and 29.9%, respectively, trailing the S&P/TSX Composite Index's 8.6% and 38.8% returns.
  • Leverage decreased to 11.0% of net assets, down from 11.9% at year-end 2025 and 14.1% a year prior.
  • Share price returns with dividends reinvested were 7.0% YTD and 35.3% over 12 months.
  • Top 10 holdings comprised 35.6% of the portfolio, led by Franco-Nevada (5.5%) and Celestica (4.1%).

The big picture

CGI's underperformance against the S&P/TSX Composite Index highlights the challenges of active management in a broad market rally. The reduction in leverage suggests a more conservative stance, potentially limiting upside in a strong equity environment. The concentration in Industrials and Materials may offer sector-specific opportunities but also exposes the portfolio to commodity price volatility.

What we're watching

Performance Gap
How CGI will address the persistent underperformance relative to its benchmark, particularly in a rising market.
Leverage Strategy
Whether the continued reduction in leverage will impact returns or signal a shift in risk management approach.
Sector Allocation
The pace at which CGI may rebalance its sector weightings, particularly in Industrials and Materials, which together account for nearly 40% of its portfolio.