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WebsiteCelestica Inc. (CLS) Dips Amid Profit-Taking, Fundamentals Intact
Celestica Inc. (NYSE: CLS), which surged roughly 250% last year as an AI and data-center beneficiary, fell over 5% on January 8 in New York trading. Shares touched a low of $285.44 intraday before closing at $288.60, down 5.72%. Market capitalization evaporated by about $1.79 billion in a single session.
Market Performance and Recent Moves
- Profit-taking pressure followed a rapid rally: CLS climbed more than 20% over the past three months and gained 190–250% during 2025.
- Institutional repositioning: Some asset managers disclosed reduced stakes amid concerns over stretched valuations.
### Q3 Results and 2025 Guidance
Celestica’s fundamentals remain solid:
- Q3 2025 revenue: $3.19 billion, beating consensus
- Q3 2025 EPS: $1.58, above Wall Street estimates
- 2025 annual revenue guidance upgraded to $12.2 billion, driven by strong AI server and cloud data-center demand from telecom and cloud customers.
Normal Course Issuer Bid (NCIB)
- The Toronto Stock Exchange approved CLS’s NCIB program allowing repurchase of up to 5% of outstanding common shares (approximately 5.72 million shares) from November last year through November this year.
- Management’s commitment to share repurchases underscores confidence in long-term growth and shareholder returns, despite share prices near highs.
Analyst Perspectives and Outlook
- Valuation concerns: At current levels, CLS trades in the high 30s of 2026 forward P/E, raising volatility risk if the AI investment cycle slows.
- Market view: Most see the pullback as a “breather” rather than a crash. Investors should monitor:
- Duration of the AI/data-center upcycle
- Pace of the NCIB buybacks
- Institutional ownership shifts
Overall, while short-term fluctuations may persist, Celestica’s robust earnings, upward guidance, and shareholder-friendly policies support its positioning as a leading AI and data-center infrastructure play.
