The Market and UBS Saw Celestica’s $3 Billion Raise Very Differently. Here’s Who I Think Is Right.

Celestica (CLS) just got a fresh vote of confidence. UBS upgraded the stock from “Neutral” to “Buy” and raised its price target from $410 to $430. Analyst David Vogt pointed to strong AI-driven demand for Celestica’s Ethernet switching and compute hardware. He also flagged a 1.6-terabit rack-scale system the company is building for OpenAI. Vogt expects all of this to push the revenue and earnings higher. He said that even while staying conservative, he sees earnings per share climbing at roughly a 50% yearly pace over two years. This would take the EPS from $10.83 this year to $24.72 by 2028.

The business is already booming. In its latest quarter, Celestica grew revenue 62% to $4.70 billion, and adjusted operating margin hit a company record. Management has since raised its full-year outlook twice and now guides for around $20.5 billion in revenue. CEO Rob Mionis said the demand outlook is the strongest in the company’s history.