Celestica Inc (CLS.TO)

Not trading cheap. A triple in the last year. He's a value investor. He can't explain or understand the multiple. It's for momentum-type traders. He wouldn't be involved here.

All-time high today. If you own it, sell some calls (1-2 weeks) around the $535-545 level. You probably don't want to get called away, so if it gets close just roll the price up. 

It had a good uptrend till the end of 2025, then has been sideways. It has tested support at $340-350 with resistance at $500. Now it seems to be in an upswing during a sideways trend. Not bad news.

With reference to the question he would not short the stock. It has seen a 100% gain per year over the past 3 or 4 years so has had a tremendous turn-around. There is lots of volatility and the recent pull back gives a buying opportunity. 

A name for core AI exposure. Valuation of mid-20x PE is justified, so much demand. Recent earnings and outlook were quite positive. Manages expectations, so every quarter is "a beat and a raise".

Radical transformation a few years ago. Its components are right in the wheelhouse of data centre growth, and he finds it difficult to know how long that will last. His main issue is the stretched valuation.

His go-to name in the space is TSM, also at a high valuation now.

A winner in the AI build-out: cloud infrastucture, high-speed networking and other AI-related systems. Also, they supply aerospace/defence where defence budgets have increased. Third, they're in healthtech devices. All businesses are drivers, especially AI. A lot of growth is baked into the stock, but buy on any dips, on headline about any data centres being delayed.

Instead, they own AVGO in their global fund. CLS is sort of riding the coattails of AVGO by packaging components to sell to the end consumer. Benefiting from growth in TPUs that AVGO and GOOG have been delivering. Thinks that trend will continue.

Two years ago, traded at 10x PE. Now trades at 30-35x. Lots of other companies out there do this type of work. In an eventual slowdown, may see margin and volume pressure. Could be quite volatile from here, and he'd take profits so you're just left with the house's money.

Very expensive at these levels (especially for a manufacturing company), don't buy here. Thinks we'll get a pullback, especially if there's a hiccup with all the AI stuff. New money is better spent in other areas.

Greatly benefits from the AI trade, but now at a premium valuation. Has executed well.

A long position for him. Winning in its marketplace. Supplying data centre development. If there's risk to data centres, then there's risk to this name. Trading above the 50-day MA. He's going to keep it on a pretty tight leash. Wouldn't buy today. Technically, challenges on the AI trade right now.

Doesn't like the way the NASDAQ opened up 2.4% early this morning and then reversed and is now down on the day. Not a great technical sign.

Has rode the AI boom. Alphabet is a major customer. CLS was in the right place at the right time. These stocks are volatile, but CLS has moved up a lot. Still a little upside. You could trade the volatility or take some profits.

Great run for him, and has now sold (probably too early :)  His issue is that we're going to hit a point in the buildout of the data centres where we've overbuilt capacity. And then a lot of these stocks are going to come down pretty dramatically. 

You only have to look back earlier this year to the DeepSeek rumour of a cheaper way to do AI. At the time, CLS was trading ~$200, and in a heartbeat it was down to ~$100. CLS is in a low-margin business; traded 10-12 PE for years, now 40x PE. Fantastic run, won't last forever, take some profits.