Celestica Accelerates Growth Amid Valuation Contraction

Celestica Inc. has received a strong buy rating as it continues to display impressive growth fueled by the rising demand for artificial intelligence (AI) infrastructure. In its fourth quarter, the company reported a remarkable 44% year-over-year revenue growth, with its Cloud and Connectivity Solutions (CCS) segment surging by 64%. This growth, paired with expanding profit margins, underscores the company’s effective operational execution.

As Celestica looks ahead, its guidance for the first quarter of 2026 indicates further acceleration. The company anticipates a 51% year-over-year revenue growth for Q1 and a projected 71% growth in earnings per share (EPS). Moreover, Celestica is targeting a total revenue of $17 billion for the fiscal year 2026.

Despite these positive indicators, the company’s valuation has contracted to a forward price-to-earnings (P/E) ratio of 34.86. This decline, despite the ongoing business momentum, presents what some analysts consider an attractive risk/reward opportunity for investors.

Celestica’s position in the AI infrastructure market has become increasingly significant. Over the past 52 weeks, its stock has experienced gains exceeding 100%, reflecting strong investor confidence. While recent performance has shown some volatility, the overall trajectory points toward sustained growth.

Analysts emphasize that Celestica’s strong fundamentals and robust profitability position it well for the future. The anticipated acceleration in revenue and earnings growth suggests that the company is well-prepared to capitalize on the expanding AI market.

Investors are advised to consider these factors when evaluating Celestica’s stock. The combination of impressive growth figures and a favorable outlook for the coming fiscal year paints a promising picture for potential returns, despite the current valuation contraction.

This analysis is based on data collected from various credible sources. As of now, the author holds no stock or options in Celestica Inc. Additionally, no compensation has been received for this article, which represents the author’s independent opinion.

Investors should note that past performance is not indicative of future results, and careful consideration is necessary when making investment decisions.