He does, yet Gandalf has never flaunted his power. However when angered..it's as if there's a storm in the room, he seems to..well, his presence grows if you understand my meaning.

[ there's a pause, a bit more somber: ]
Gandalf fought a terrible creature during our travels together. He used his staff to sever a bridge in half..if that is not proof enough of his power, then I know little of it.