📊 CLS Key Takeaways
Is Celestica Inc. (CLS) a Good Investment?
Celestica demonstrates exceptional operational execution with 28.5% revenue growth and net income nearly doubling YoY, driven by strong margin expansion and robust free cash flow generation. The company maintains healthy balance sheet metrics with moderate leverage (0.34x D/E) and solid liquidity, supported by 659.5M in operating cash flow and 458.3M in free cash flow, indicating sustainable growth trajectory.
Celestica shows strong fundamental momentum, with revenue up 28.5% and net income up 94.5%, indicating that growth is translating into materially higher earnings rather than just higher volume. Profitability is solid for a manufacturing business, balance sheet leverage is manageable, and free cash flow is positive, though relatively modest versus revenue and supported by still-thin gross margins. Overall, the fundamentals point to a high-quality growth phase, but the business remains exposed to execution and margin pressure typical of a low-margin hardware supply chain model.
Why Buy Celestica Inc. Stock? CLS Key Strengths
- Exceptional net income growth of 94.5% YoY significantly outpacing 28.5% revenue growth demonstrates operating leverage and margin expansion
- Strong free cash flow generation of 458.3M with 3.7% FCF margin provides capital flexibility for debt reduction, investments, or shareholder returns
- Outstanding returns on equity (37.6%) and assets (11.5%) indicate highly efficient capital deployment and operational excellence
- Moderate leverage at 0.34x D/E ratio with 750.5M long-term debt provides balance sheet strength and refinancing flexibility
- Significant insider activity with 33 Form 4 filings in last 90 days suggests management confidence in business trajectory
- Rapid revenue and earnings growth with diluted EPS up 98.3% YoY
- Strong profitability improvement, including 8.4% operating margin and 37.6% ROE
- Healthy financial position with positive free cash flow, 1.44x current ratio, and low 0.34x debt-to-equity
CLS Stock Risks: Celestica Inc. Investment Risks
- Quick ratio of 0.88x indicates potential near-term liquidity constraints despite adequate current ratio, requiring monitoring of working capital management
- Operating margin of 8.4% and net margin of 6.7% remain compressed relative to profitability growth, suggesting pricing power or operational efficiency may be at limits
- Revenue concentration in printed circuit boards sector (SIC 3672) exposes company to cyclical semiconductor and electronics manufacturing demand
- Missing interest coverage ratio data prevents full assessment of debt service capacity, particularly important given 750.5M long-term debt load
- Gross margin of only 12.1% is thin and vulnerable to input cost inflation, supply chain disruptions, or competitive pricing pressures
- Gross margin of 12.1% and free cash flow margin of 3.7% leave limited room for operational missteps
- Quick ratio of 0.88x suggests continued dependence on efficient working capital management
- Manufacturing-led growth can be cyclical and vulnerable to customer mix, demand swings, or cost pressure
Key Metrics to Watch
- Operating margin trend - monitor if 8.4% can expand further or if margin expansion has peaked
- Free cash flow sustainability - track if 458.3M FCF can be maintained with ongoing capex requirements of 201.2M
- Days sales outstanding and inventory turnover - assess working capital efficiency given thin quick ratio of 0.88x
- Gross margin stability - critical indicator of pricing power and manufacturing cost control in competitive PCB sector
- Operating margin and gross margin sustainability
- Free cash flow conversion relative to net income
Celestica Inc. (CLS) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 3.7% FCF margin may limit capital allocation flexibility.
CLS Profit Margin, ROE & Profitability Analysis
CLS vs Market Sector: How Celestica Inc. Compares
How Celestica Inc. compares to Market sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Celestica Inc. Stock Overvalued? CLS Valuation Analysis 2026
Based on fundamental analysis, Celestica Inc. has mixed fundamental signals relative to the Market sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Celestica Inc. Balance Sheet: CLS Debt, Cash & Liquidity
CLS Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Celestica Inc.'s revenue has grown significantly by 28% over the 5-year period, indicating strong business expansion. The most recent EPS of $2.03 reflects profitable operations.
CLS Revenue Growth, EPS Growth & YoY Performance
CLS Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $2.5B | $89.5M | $0.75 |
| Q2 2025 | $2.4B | $95.0M | $0.80 |
| Q1 2025 | $2.2B | $86.2M | $0.74 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Celestica Inc. Dividends, Buybacks & Capital Allocation
CLS SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Celestica Inc. (CIK: 0001030894)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CLS
What is the AI rating for CLS?
Celestica Inc. (CLS) has a Combined AI Rating of BUY from Claude (STRONG BUY) and ChatGPT (BUY) with 82% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CLS's key strengths?
Claude: Exceptional net income growth of 94.5% YoY significantly outpacing 28.5% revenue growth demonstrates operating leverage and margin expansion. Strong free cash flow generation of 458.3M with 3.7% FCF margin provides capital flexibility for debt reduction, investments, or shareholder returns. ChatGPT: Rapid revenue and earnings growth with diluted EPS up 98.3% YoY. Strong profitability improvement, including 8.4% operating margin and 37.6% ROE.
What are the risks of investing in CLS?
Claude: Quick ratio of 0.88x indicates potential near-term liquidity constraints despite adequate current ratio, requiring monitoring of working capital management. Operating margin of 8.4% and net margin of 6.7% remain compressed relative to profitability growth, suggesting pricing power or operational efficiency may be at limits. ChatGPT: Gross margin of 12.1% and free cash flow margin of 3.7% leave limited room for operational missteps. Quick ratio of 0.88x suggests continued dependence on efficient working capital management.
What is CLS's revenue and growth?
Celestica Inc. reported revenue of $12.4B.
Does CLS pay dividends?
Celestica Inc. does not currently pay dividends.
Where can I find CLS SEC filings?
Official SEC filings for Celestica Inc. (CIK: 0001030894) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CLS's EPS?
Celestica Inc. has a diluted EPS of $7.16.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CLS a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Celestica Inc. has a BUY rating with 82% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is CLS stock overvalued or undervalued?
Valuation metrics for CLS: ROE of 37.6% (sector avg: 15%), net margin of 6.7% (sector avg: 12%). Higher ROE suggests strong returns relative to peers.
Should I buy CLS stock in 2026?
Our dual AI analysis gives Celestica Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CLS's free cash flow?
Celestica Inc.'s operating cash flow is $659.5M, with capital expenditures of $201.2M. FCF margin is 3.7%.
How does CLS compare to other Market stocks?
Vs Default sector averages: Net margin 6.7% (avg: 12%), ROE 37.6% (avg: 15%), current ratio 1.44 (avg: 1.8).
Why is CLS's return on equity (ROE) so high?
Celestica Inc. has a return on equity of 37.6%, significantly above the Market sector average of 15%. A high ROE indicates the company is efficient at generating profits from shareholder equity. This is supported by a 6.7% net margin.