Celestica Inc (CLS.TO)

Pitfalls would include chasing or buying too much. Other risks are not following it and not having a plan. Acceleration is really strong. Good volume along with the buying, which is supportive. Reaching a bit of a limit right now, which may be profit taking, and may pull back to $110. A drop below $105 with a full position is a problem.

It has changed a lot and starting to focus more on helping clients develop new projects. It is riding the AI boom and has just passed the old high from23 years ago. Has had a very low multiple for a long time. It has started to execute better, grow faster and meet expectations. It is quite cheap in terms of tech stocks and should do quite well from a momentum standpoint.

Probably overbought here, up 240% in last 12 months. 21-22x forward earnings, 15-16% EPS growth rate. Not really expensive. Likes it.

Keeps going up. Business has totally morphed into value-added parts in the semiconductor space. Riding the wave of massive growth of all chipmakers. Valuation seems reasonable. Remember that semis are cyclical; ASML, for example, went down 20% yesterday. Hot stocks always have potential to re-rate.

Quite well run, but not ready to be there. His preference is TSM, but its valuation is not attractive either.

He wished he owned this. It's had a big move and is breaking out into new highs. A good momentum play.

Trending higher above the 200-day MA, which itself is moving higher. Watch it in terms of how far the valuation goes. Right now, 15x forward earnings with about a 13% growth rate for 2025, 29% for 2026. Valuation is actually not as expensive as a lot of other tech names, especially in the US. Valuation and technicals look decent.

Broke trend, rallied, but made a lower high. Now making a lower low. He has a very low weight in tech, about 12%; whereas the S&P is about 28-29%. So many other things to do that are less crowded than tech. Technical setup not great; background for tech not as good as it was.

12-month price target of $79, still a bit of room. On the chart, you can see the highs that go back to the early summer. Buy 1/3 here around $68, another at just under $64 where there seems to be some support, and the final 1/3 at just over $60. Put in a stop around $54-55.

Concentration risk, but its manufacturing and platform solutions are state of the art. Client base includes hyperscalers and service providers. Extremely well run.

Wished he bought it a year ago. Have very low margins, but now benefit from supplying equipment to hyperscalers. They hugely depend on one client, though, in their AI-related, data centre business. Can be very volatile. Careful. Take profits if you've made money here. 

Pulled back in July, rallied to a lower high, now has pulled back to just above the rising 200-day MA. Price pattern is a lot like big tech. Hold, but don't add. If you own it, use the 200-day as a line in the sand. Watch those lows from July. Be cautious. If it breaks $60, need to have a hard discussion.

Like Broadcom, delivers AI communications equipment, which has driven its rally. He's bullish the AI build-out long-term, and Celestica will benefit. You can start building a position in this.

It has been in an uptrend and has pulled back. If the trend is confirmed then buy. .

This decline is temporary, though could last longer if the US Fed announces it will hold rates now and in September (he believes they won't). CLS is a core position, so he will keep adding to it.

With this type of stock, he asks himself whether it's just not better to own NVDA? CLS is benefiting today from data centre buildout and relationship with GOOG (an open secret). Those dynamics don't make them the best position in the value chain relative to NVDA and other players.

It's the end of the bullwhip effect. NVDA is the real, bleeding-edge innovator in the ecosystem. Sell CLS, and roll the gains into NVDA.

Come off quite a bit today to just under $74. Price target 12 months out is $79. Tremendous respect of clients. Buy a third here at $74, another at $71-72, and the final third under $70.