CIBC Capital Markets maintained its outperformer rating and price target of US$480 on the shares of Celestica (CLS.TO, CLS) after the company's appearance at the bank's Technology & Innovation Conference.
The bank said the company's message sharpened its conviction that 2026 and 2027 guidance likely remains "too low".
"Celestica CFO Mandeep Chawla pointed to stronger demand and upside across CCS, spanning communications switching and enterprise servers, while noting capacity planning for key hyperscaler and digital-native customers now extends through 2029," said analyst Todd Coupland. "The only meaningful constraint is supply, with some component lead times stretching to 99 weeks-an intensity that exceeds what was seen during the pandemic."
It noted demand is tracking ahead of company guidance and Street expectations, even if supply constraints create some near-term quarterly volatility. The bank continues to recommend buying Celestica, as it sees a "compelling setup of upward estimate revisions, improving visibility, and attractive risk/reward."
CIBC's US$480 PT on the company is based on a blended valuation of 32x its 2027 EPS estimate and 24x its 2027 EBITDA estimate.
"This valuation premium is justified, in our view, by improving visibility into sustained AI data center spending, a rising probability of upward revisions, and Celestica's increasingly strategic role in next-generation networking and server infrastructure," said Coupland.
Price: $519.10, Change: $+11.11, Percent Change: +2.19%