UPDATE: Jefferies Upgrades CGI as Key Metrics are Set to Improve

In a report published Thursday, Jefferies analyst Jason Kupferberg upgraded the rating on

from Hold to Buy, and raised the price target from $34.00 to $39.00. In the report, Jefferies noted, “We are upgrading GIB to Buy from Hold because: 1) we believe cash flow concerns are overblown, and expect FCF performance to recover solidly in the current quarter, 2) recently robust bookings trends should drive gradual improvement in organic top-line growth, 3) any impacts from the healthcare.gov contract look manageable, 4) attractive valuation (11.0x C15 P/E vs. best comp CSC at 12.8x C15 P/E).” CGI closed on Wednesday at $32.24.