The S&P 500 technology sector is heading into Q4 with solid momentum—the second-highest performing sector year-to-date—and is up about 50% since the market bottomed on April 8. The tech sector offers huge earnings upside potential due to major trends such as booming AI-fueled capital spending, adoption of smart technologies, and expanding connectivity and satellite communications. Tech stocks have also benefitted from rising interest rate cut expectations, cooling inflation, steady economic growth, and solid Q2 earnings results.
Celestica's rally is justified by strong margin expansion, driven by the high-growth, high-margin HPS sub-segment, now 43% of sales and rising. Celestica delivered exceptional Q2 2025 results with $2.89B revenue (+20.9% YoY) and $1.39 adjusted EPS (+52.75% YoY), achieving highest-ever 7.4% EBIT margin. HPS sub-segment drove 82% YoY growth, now representing 43% of total sales versus 8% last year, creating sustainable margin expansion trajectory.
Celestica's transition to an ODM model and AI infrastructure focus has driven outsized stock gains, outpacing the S&P 500 significantly. The company's CCS segment, especially HPS, is capturing hyperscaler wins and leading in 800G Ethernet switches, cementing its AI supply chain position. The strategic shift to higher-margin ODM and services, plus ATS segment diversification, is fundamentally improving profitability and providing downside protection.
In the closing of the recent trading day, Celestica (CLS) stood at $195.12, denoting a -8.11% move from the preceding trading day.
Celestica (CLS) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
Here is how Celestica (CLS) and Arlo Technologies (ARLO) have performed compared to their sector so far this year.
CLS and JBL are capitalizing on AI-driven demand in the EMS space, with analysts seeing strong short-term price upside for both stocks.
Celestica (CLS) witnesses a hammer chart pattern, indicating support found by the stock after losing some value lately. This coupled with an upward trend in earnings estimate revisions could mean a trend reversal for the stock in the near term.
Celestica and Jabil vie for AI-driven growth, but the former's stronger momentum and growth outlook make it the favored pick.
CLS surges 103.4% year to date, fueled by strong demand for 800G and 400G networking switches, AI-driven innovation, and robust cash flow.
Does Celestica (CLS) have what it takes to be a top stock pick for momentum investors? Let's find out.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price.