Celestica Inc. (CLS) Down 5.3% — Time to Reverse Course?
Celestica Inc. (CLS) is losing ground, with shares retreating 5.34% on the session and giving up $17.05 to close at $302.16 on the NYSE. The stock remains under pressure after sliding further away from its 52-week peak of $363.40 reached on Nov. 5, 2025, now trading roughly $61 below that high. Trading activity was relatively muted, with about 1.54 million shares changing hands, well below the 90-day average volume of roughly 3.02 million shares. That lighter participation suggests the recent pullback is unfolding without strong buying support stepping in at current levels, leaving the price action looking vulnerable in the near term.
Celestica’s latest move stands out as notably weaker compared with several large technology hardware peers such as Apple (AAPL), Cisco Systems (CSCO), and Amphenol (APH), which have shown more resilient price trends in recent sessions. While those names have generally held closer to their recent trading ranges, Celestica has been sliding from its highs, giving back a meaningful portion of its earlier gains. With the stock now sitting a clear distance below its 52-week high and trading on subdued volume, the overall picture points to a name facing headwinds and struggling to maintain upward momentum, especially when stacked against better-performing peers in the same space.
Why Celestica Inc. Price is Moving Lower
The latest pullback in Celestica Inc. comes on the heels of a sharp, sentiment-driven rally, leaving the stock vulnerable to profit-taking and heightened volatility. After a strong run-up fueled by positive analyst revisions, AI product excitement and a fresh 52-week high, the 4.02% decline on Feb. 10 signals growing caution that recent gains may have run ahead of fundamentals. The stock’s outperformance versus the broader technology space year-to-date increases the risk that even modest disappointments or shifts in risk appetite can trigger outsized downside moves as short-term traders lock in profits.
Concerns also center on execution risk and capital intensity tied to Celestica’s aggressive growth plans. Management’s raised 2026 outlook — including a revenue target of $17.0 billion and $8.75 in adjusted EPS — assumes sustained momentum in higher-margin AI networking hardware, such as its new 1.6TbE AI switches. While 27.79% revenue growth and a 6.20% profit margin underscore operational progress, investors are weighing these positives against roughly $1 billion in planned capital expenditures and the possibility of margin pressure if demand or pricing in AI hardware normalizes. Against established peers like Apple, Western Digital and Seagate, Celestica’s rapid ascent and elevated expectations leave less room for error. As a result, the current weakness is being viewed as a repricing of risk, with the market reassessing how much of the long-term AI and growth story is already embedded in the shares.
What is the Celestica Inc. Rating - Should I Sell?
Weiss Ratings assigns CLS a B rating. Current recommendation is Buy. That sounds favorable on the surface, but investors should be careful not to overlook the risks embedded in this profile. A B rating means Celestica Inc. has delivered a solid overall balance of reward and risk so far, yet it does not rise to the lowest-risk tier, and the downside from current levels could be meaningful if expectations reset.
Operationally, Celestica scores very well. The Excellent Growth Index, Excellent Efficiency Index and Excellent Solvency Index show that the company has been expanding rapidly, generating high returns on capital and maintaining a strong balance sheet. The Excellent Total Return Index confirms that recent shareholders have enjoyed powerful gains. However, with revenue growth at 27.79% and a profit margin of just 6.20%, the stock now trades at a very rich forward P/E of 52.98. That kind of valuation leaves little room for disappointment and can quickly turn against investors if growth slows or margins compress.
The main check on the story is risk. The Fair Volatility Index signals that price swings are already non-trivial, and a premium valuation combined with a 36.38% ROE can attract short-term momentum traders, increasing fragility. Compared with Information Technology peers like Apple Inc. (AAPL, B), Cisco Systems, Inc. (CSCO, B) and Amphenol Corporation (APH, B), Celestica’s risk/reward trade-off looks more aggressive at today’s multiples. In other words, the strong sub-indices justify the current B (Buy) rating, but they do not guarantee protection if sentiment turns, making caution warranted for new money at elevated prices.
About Celestica Inc.
Celestica Inc. is a global electronics manufacturing services (EMS) and hardware technology solutions provider operating within the Information Technology sector, with a focus on Technology Hardware and Equipment. The company centers its business on designing, engineering, and assembling complex electronic products for original equipment manufacturers across communications, enterprise, aerospace and defense, industrial, and other infrastructure-oriented markets. Its offerings typically span the full product lifecycle, from early design and prototyping through to volume manufacturing, systems integration, and after-market services such as repair and refurbishment. Celestica positions itself as a partner for customers seeking to outsource high-mix, lower-margin manufacturing and related operations that they prefer to keep off their own balance sheets.
The company’s portfolio skews toward sophisticated, often customized hardware rather than high-margin proprietary platforms. Celestica manufactures networking equipment, data center hardware, embedded computing systems, and a range of industrial and aerospace components, generally built to client specifications. This contract-based model tends to leave Celestica heavily dependent on a limited set of large customers, exposing it to concentration risk, pricing pressure, and limited control over product roadmaps. In segments such as communications and data center infrastructure, Celestica faces intense competition from larger EMS providers and lower-cost regional manufacturers, making sustained differentiation difficult. Although it emphasizes engineering support and supply chain management as value-added services, the company operates in a structurally competitive, commoditized environment where bargaining power often sits with customers rather than with the manufacturer.
Investor Outlook
Despite its B (Buy) Weiss Rating, investors may want to exercise caution with Celestica Inc. (CLS) by closely tracking any deterioration in risk factors that could pressure this favorable risk/reward profile. Watch for shifts in broader Information Technology sector sentiment and any developments that could threaten operational execution, as these may eventually weigh on the current rating. See full rankings of all B-rated Information Technology stocks inside the Weiss Stock Screener.
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