Why Celestica Stock Soared This Week
Key Points
Celestica reported strong results and predicted impressive growth through 2026.
The company is benefiting from booming demand for AI infrastructure.
The stock jumped this week, but the valuation now looks rich.
- 10 stocks we like better than Celestica ›
Shares of data center infrastructure provider Celestica (NYSE: CLS) were up 14.9% for the week as of Thursday at 2:45 p.m. ET, according to data provided by S&P Global Market Intelligence. The main driver of the gain was a strong third-quarter earnings report on Monday, which featured double-digit revenue growth and even faster adjusted earnings growth.
Image source: Getty Images.
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now, when you join Stock Advisor. See the stocks »
Booming AI infrastructure demand is a tailwind for Celestica
Celestica's revenue soared by 28% year over year in the third quarter, easily beating analyst expectations. Adjusted earnings per share also exceeded analyst estimates, growing by 52% to $1.58.
On top of reporting strong results, Celestica boosted its full-year outlook and provided a solid outlook for 2026. For 2025, revenue is now expected to be around $12.2 billion, with adjusted EPS of $5.90. For 2026, revenue should rise to $16 billion, and adjusted EPS should reach $8.20.
In an interview following the earnings report with CNBC, Celestica CEO Robert Mionis described its role in the artificial intelligence (AI) infrastructure market as "laying the tracks ahead of the freight train." The company designs storage, compute, and networking solutions for cloud data centers, and booming demand for AI infrastructure is helping to push up revenue.
The company's 2026 outlook is supported by strong demand from its largest customers. Celestica also noted that there were "indications of these dynamics continuing into 2027." Revenue will grow by 31% in 2026 if the company hits its guidance, and equally impressive growth could follow in 2027 if demand for AI infrastructure holds up.
Is Celestica a buy?
Things are going great for Celestica right now, but the stock's valuation has become stretched. Based on that 2026 outlook, Celestica stock trades for roughly 42 times forward earnings. There's not a lot of room for error going forward.
By hitching its wagon to the AI infrastructure boom, Celestica is exposed to the risk of the boom turning into a bust. While all signs point to growing demand for AI infrastructure for now, Celestica's fortunes could shift quickly down the road.
Should you invest $1,000 in Celestica right now?
Before you buy stock in Celestica, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Celestica wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $593,442!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,269,127!*
Now, it’s worth noting Stock Advisor’s total average return is 1,071% — a market-crushing outperformance compared to 196% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
See the 10 stocks »
*Stock Advisor returns as of October 27, 2025
Timothy Green has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Celestica. The Motley Fool has a disclosure policy.
Recommended Articles
