Bull of the Day: Celestica (CLS)

Company Overview - Celestica is one of the largest electronics manufacturing companies globally, providing supply chain solutions across North America, Europe, and Asia [1] - The company offers a range of services including new product design, engineering, component sourcing, mechanical assembly, systems integration, and logistics [5] - Celestica is involved in the AI movement, delivering platform solutions that encompass infrastructure platforms and hardware/software design services [5] Industry Position - Celestica is part of the Zacks Electronics – Manufacturing Services industry group, which ranks in the top 4% out of over 250 industries [3] - The company is expected to outperform the market over the next 3 to 6 months, supported by its strong industry ranking [3] - Historical data indicates that the top 50% of Zacks Ranked Industries outperform the bottom 50% by a factor of more than 2 to 1 [3] Financial Performance - Celestica reported second-quarter earnings of $1.39 per share, exceeding the consensus estimate of $1.24 by 12.1% [9] - Revenues for the same quarter were $2.89 billion, surpassing projections by 8.3% [9] - The full-year consensus EPS estimate has been revised upward by 0.59% to $5.08 per share, indicating a potential growth rate of 30.9% compared to the previous year [10] Stock Performance - The stock has advanced nearly 200% since April lows, indicating strong upward momentum [11] - Both the 50-day and 200-day moving averages are trending upwards, with the stock making a series of higher highs over the past year [14] - Positive earnings estimate revisions are expected to support continued bullish performance [15] Future Outlook - The proliferation of AI-based applications and generative AI tools presents significant growth opportunities for Celestica [16] - The company has provided a bullish outlook for 2025 and has increased previous guidance, suggesting sustainability in its growth trajectory [16] - Recent positive earnings estimate revisions are likely to create a safety net against sudden downside moves [17]