Celestica Inc. Common Stock (CLS)
Fast GrowerFairStock Score: 53/100 — MIXED
Key Financials
| Current Price | $358.55 |
| Market Cap | $46.2B |
| P/E Ratio | 43.46 |
| ROE | 52.45% |
| Dividend Yield | —% |
| Sector | Technology |
Strengths
- Generates $595 million in annual free cash flow (1.3% yield on market cap)
- High return on equity of 40.5% demonstrating efficient capital deployment
- Conservative balance sheet with debt-to-equity of just 0.41, providing financial flexibility
- Altman Z-Score of 6.6 confirms minimal bankruptcy risk and strong solvency
- Revenue growth of 43.6% demonstrates strong top-line momentum
Concerns
- Trades significantly above Graham Number ($56) with negative 622% margin of safety—limited downside protection
AI Analysis
Celestica Inc. Common Stock is a mid-cap technology company valued at $46.2 billion. The business generates $12.4 billion in annual revenue with a 2.2% net margin and $595 million in free cash flow. From a quality standpoint, Celestica shows Altman Z-Score of 6.6 confirms fortress-level solvency and extraordinary 40% return on equity. On valuation, the stock is commanding a steep 54.8x multiple, with trades far above its Graham Number ($56) with no margin of safety. Growth dynamics show revenue growing at 43.6% and profit growth of 98.2%. Our composite FairStock Score of 52/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.
Bull Case
Celestica's 44% revenue growth trajectory could accelerate as it captures additional market share in the technology sector. With $595 million in annual free cash flow (1.3% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.
Bear Case
At 55x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.
Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer