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In summary, while RBC Capital has lowered the price target for Celestica (TSX:CLS), the firm’s analysts continue to see the stock favorably, underpinned by strong hyperscaler demand and the company’s strategic positioning to handle external pressures. With its GREAT financial health rating and strong market performance, Celestica demonstrates resilience in a volatile market. Discover more detailed insights and access the comprehensive Pro Research Report for Celestica, along with 1,400+ other top stocks, exclusively on InvestingPro. With its GREAT financial health rating and strong market performance, Celestica demonstrates resilience in a volatile market. Discover more detailed insights and access the comprehensive Pro Research Report for Celestica, along with 1,400+ other top stocks, exclusively on InvestingPro.
In a recent statement, RBC Capital analysts noted that Celestica is anticipated to present strong first-quarter results on April 24, which could surpass both their own projections and the market consensus. This optimism is based on the ongoing expansion of data centers by hyperscaler clients. The company’s impressive 21.17% revenue growth and 87.51% stock return over the past year support this positive outlook. For deeper insights into Celestica’s financial metrics and growth potential, InvestingPro subscribers can access comprehensive analysis and 15+ additional ProTips. Despite a history of raising guidance in the past two fiscal years, the analysts predict that Celestica will likely maintain its fiscal year 2025 guidance unchanged due to the current uncertain economic environment.
Celestica’s hyperscaler customers, who contribute to half of the company’s revenue, are expected to maintain their spending due to their data center deployment plans, which could offset the risks associated with new tariffs. RBC Capital suggests that these clients are less sensitive to price changes in the short term, which could help sustain order volumes for Celestica.
Furthermore, the analysts believe that Celestica’s global operational footprint could be an advantage in navigating supply chain disruptions that the industry is facing. The company’s wide-reaching presence enables it to manage these challenges more effectively than some competitors.
The report also mentions that Celestica’s fiscal year 2025 guidance likely includes a conservative approach, which takes into account the potential headwinds. This conservative outlook could position Celestica to reiterate its guidance for FY25, despite the current economic uncertainties.
In summary, while RBC Capital has lowered the price target for Celestica, the firm’s analysts continue to see the stock favorably, underpinned by strong hyperscaler demand and the company’s strategic positioning to handle external pressures.
In other recent news, Celestica Inc (NYSE:CLS). reported a 21% revenue growth in 2024, primarily driven by strong demand for data center hardware from major hyperscalers. The company expects continued strong top-line growth in 2025, fueled by increased AI adoption and demand for its networking and custom ASIC servers. Celestica has transitioned from International Financial Reporting Standards (IFRS) to U.S. Generally Accepted Accounting Principles (US GAAP), reflecting its commitment to transparency and adherence to U.S. reporting standards. S&P Global Ratings upgraded Celestica’s credit rating to ’BB+’ from ’BB’, citing strong operating performance and robust momentum. JPMorgan initiated coverage on Celestica with an Overweight rating, highlighting the company’s potential in AI infrastructure. Stifel increased its price target for Celestica shares to $150, while RBC Capital Markets raised their target to $160, both firms citing strong engineering capabilities and strategic initiatives. These developments indicate a positive outlook for Celestica, driven by its strategic investments and focus on high-margin businesses.
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