CELESTICA INC (NYSE:CLS) – A Strong Growth Candidate Meeting Minervini’s Criteria

CELESTICA INC (NYSE:CLS) has emerged as a compelling candidate for growth investors, meeting both the technical requirements of Mark Minervini’s Trend Template and exhibiting strong fundamental growth momentum. The stock’s recent performance and underlying business trends suggest potential for further upside.

Technical Strength: Meeting Minervini’s Trend Template

The stock satisfies key technical criteria outlined in Minervini’s strategy:

• Price Above Key Moving Averages: CLS is trading above its 50-day ($102.68), 150-day ($100.24), and 200-day ($89.25) moving averages, confirming a strong uptrend.
• Upward-Sloping Averages: Both the 150-day and 200-day moving averages are trending higher, reinforcing long-term bullish momentum.
• Relative Strength: With a ChartMill Relative Strength score of 97.19, CLS outperforms nearly all stocks in its sector and the broader market.
• Proximity to Highs: The stock is trading within 8.4% of its 52-week high ($144.27) and has surged 136% over the past year.

Fundamental Growth Momentum

Beyond technical strength, CLS demonstrates robust growth metrics:

• Earnings Growth: EPS (TTM) grew 51% year-over-year, with quarterly EPS growth accelerating in recent quarters (39.5% in the latest quarter, up from 46.1% and 60% in prior quarters).
• Revenue Expansion: Sales increased 19.9% year-over-year in the most recent quarter, with full-year revenue growth at 21.2%.
• Profit Margins: The company’s trailing twelve-month profit margin stands at 4.44%, up from 3.07% the prior year, indicating improving efficiency.
• Estimate Beats: CLS has beaten EPS estimates in all of the last four quarters, with an average surprise of 7.5%.

Industry and Market Position

As a provider of supply chain solutions in the Electronic Equipment, Instruments & Components sector, CLS benefits from strong demand in its Advanced Technology Solutions (ATS) and Connectivity & Cloud Solutions (CCS) segments. The stock ranks in the top 9% of its industry group based on relative strength.

Technical Report Summary

According to ChartMill’s technical analysis, CLS scores a perfect 10 for technical health, supported by strong trends across multiple timeframes. However, the setup rating is currently 3, suggesting that while the stock is in a powerful uptrend, it may need a consolidation phase before presenting an optimal entry point.

For a deeper technical breakdown, review the full technical report here.

Our High Growth Momentum + Trend Template screener identifies more stocks with similar growth and technical strength.

Disclaimer

This is not investment advice. The analysis highlights observations at the time of writing, but investors should conduct their own research before making decisions.