The Successful Investor Hotline – Friday, January 3, 2014

Article Excerpt

CGI GROUP INC., $34.96, Toronto symbol GIB.A, is Canada’s largest provider of computer outsourcing services. It helps its clients automate certain routine functions, like accounting and buying supplies. That makes companies more efficient and lets them focus on their main businesses. The company is the lead contractor for the website, which lets Americans shop for health insurance plans under the Affordable Care Act (or Obamacare). Since the site began operating on October 1, 2013, visitors have had trouble logging on and evaluating the various health plans. As a result, fewer users than expected have signed up. These problems have prompted Massachusetts and Vermont to withhold scheduled payments to CGI. Other states may do the same or demand refunds. That’s mainly why the stock is down 7% in the past week. Massachusetts has paid just $11 million U.S. of a $69 million U.S. contract with CGI. Vermont is disputing $6.1 million U.S. in charges. However, these amounts are small in relation to…

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