SMCI - Celestica's Guidance Potentially Implies Fading Hyperscaler Strength
2024-03-22 13:04:03 ET
Summary
- Celestica Inc. stock has gained 3x its value from a year ago and continues to trade near all-time highs.
- The company is well positioned to capitalize on AI-driven total addressable market expansion, with its hyperscaler solutions gaining heightened demand.
- However, decelerating growth and conservative profitability metrics for Celestica continue to trail those of comparable thematic AI winners, introducing potential weakness to its pace of multiple expansion in the near term.
Celestica Inc. ( CLS ) stock has gained as much as 3x its value from a year ago, and continues to trade near all-time highs. The company has consistently delivered positive quarterly progress, especially with its hyperscaler business’ continued capture of immediate AI opportunities. This has largely overshadowed CLS’ inherently elevated exposure to cyclical weakness in some of the core verticals of its Advanced Technology Solutions (“ATS”) segment....
Celestica's Guidance Potentially Implies Fading Hyperscaler Strength