Celestica: It's Finally Too Cheap To Ignore (Rating Upgrade)

It's finally time to upgrade Celestica to Buy as the stock finds a firm footing at the $280 level, driven by re-energized bullish sentiments in the AI value chain. CLS benefits from deepened co-design partnerships with AMD and OpenAI, lowering revenue concentration risks and expanding beyond traditional hyperscaler workloads. Q2 results were clearly strong, with revenue up 62%, adjusted operating margins at 8.2% (above guidance), and management guided Q3 margin even higher. Valuation has normalized significantly, while the growth outlook through 2027 remains resilient, corroborating the revenue conversion story. Price action for CLS has now reached an inflection point where dip buyers are coming back to support the recovering opportunity. And it's finally too cheap for investors to ignore.