CELESTICA INC (CLS.CA) Stock Fundamental Analysis

Canada - Toronto Stock Exchange - TSX:CLS - CA15101Q2071 - Common Stock

452.26 CAD

+29.8 (+7.05%)

Last: 1/27/2026, 7:00:00 PM

Fundamental Rating

Taking everything into account, CLS scores 7 out of 10 in our fundamental rating. CLS was compared to 15 industry peers in the Electronic Equipment, Instruments & Components industry. CLS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CLS is growing strongly while it is still valued neutral. This is a good combination! These ratings could make CLS a good candidate for growth and quality investing.

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1. Profitability

1.1 Basic Checks

CLS had positive earnings in the past year.
CLS had a positive operating cash flow in the past year.
Each year in the past 5 years CLS has been profitable.
In the past 5 years CLS always reported a positive cash flow from operatings.

1.2 Ratios

CLS has a better Return On Assets (10.85%) than 100.00% of its industry peers.
The Return On Equity of CLS (35.33%) is better than 100.00% of its industry peers.
With an excellent Return On Invested Capital value of 21.33%, CLS belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CLS is in line with the industry average of 9.87%.
The 3 year average ROIC (11.43%) for CLS is below the current ROIC(21.33%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	10.85%
ROE	35.33%
ROIC	21.33%

ROA(3y)4.63%

ROA(5y)3.55%

ROE(3y)15.02%

ROE(5y)11.3%

ROIC(3y)11.43%

ROIC(5y)8.93%

1.3 Margins

Looking at the Profit Margin, with a value of 6.35%, CLS is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
In the last couple of years the Profit Margin of CLS has grown nicely.
CLS has a better Operating Margin (7.33%) than 80.00% of its industry peers.
In the last couple of years the Operating Margin of CLS has grown nicely.
CLS's Gross Margin of 12.04% is on the low side compared to the rest of the industry. CLS is outperformed by 80.00% of its industry peers.
CLS's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	7.33%
PM (TTM)	6.35%
GM	12.04%

OM growth 3Y24.27%

OM growth 5Y29.03%

PM growth 3Y34%

PM growth 5Y30.13%

GM growth 3Y8.03%

GM growth 5Y10.39%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

CLS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for CLS has been reduced compared to 1 year ago.
Compared to 5 years ago, CLS has less shares outstanding
CLS has a worse debt/assets ratio than last year.

2.2 Solvency

CLS has an Altman-Z score of 7.43. This indicates that CLS is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.43, CLS is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
CLS has a debt to FCF ratio of 1.97. This is a very positive value and a sign of high solvency as it would only need 1.97 years to pay back of all of its debts.
CLS has a better Debt to FCF ratio (1.97) than 93.33% of its industry peers.
CLS has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.37, CLS is doing worse than 60.00% of the companies in the same industry.
Although CLS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.37
Debt/FCF	1.97
Altman-Z	7.43

ROIC/WACC2.67

WACC8%

2.3 Liquidity

CLS has a Current Ratio of 1.47. This is a normal value and indicates that CLS is financially healthy and should not expect problems in meeting its short term obligations.
CLS has a Current ratio (1.47) which is comparable to the rest of the industry.
A Quick Ratio of 0.88 indicates that CLS may have some problems paying its short term obligations.
With a Quick ratio value of 0.88, CLS perfoms like the industry average, outperforming 46.67% of the companies in the same industry.
CLS does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.47
Quick Ratio	0.88

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 47.90% over the past year.
The Earnings Per Share has been growing by 48.11% on average over the past years. This is a very strong growth
CLS shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.09%.
CLS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.38% yearly.

EPS 1Y (TTM)47.9%

EPS 3Y44.1%

EPS 5Y48.11%

EPS Q2Q%51.92%

Revenue 1Y (TTM)22.09%

Revenue growth 3Y19.63%

Revenue growth 5Y10.38%

Sales Q2Q%27.79%

3.2 Future

CLS is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 38.14% yearly.
CLS is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 27.74% yearly.

EPS Next Y53.05%

EPS Next 2Y46.37%

EPS Next 3Y43.28%

EPS Next 5Y38.14%

Revenue Next Year26.52%

Revenue Next 2Y29.69%

Revenue Next 3Y30.76%

Revenue Next 5Y27.74%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 62.64, CLS can be considered very expensive at the moment.
86.67% of the companies in the same industry are more expensive than CLS, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.82, CLS is valued quite expensively.
A Price/Forward Earnings ratio of 39.37 indicates a quite expensive valuation of CLS.
Based on the Price/Forward Earnings ratio, CLS is valued cheaper than 93.33% of the companies in the same industry.
CLS is valuated expensively when we compare the Price/Forward Earnings ratio to 25.95, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	62.64
Fwd PE	39.37

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, CLS is valued a bit cheaper than the industry average as 80.00% of the companies are valued more expensively.
CLS's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CLS is cheaper than 73.33% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	95.53
EV/EBITDA	38.93

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CLS may justify a higher PE ratio.
CLS's earnings are expected to grow with 43.27% in the coming years. This may justify a more expensive valuation.