Wondering if Celestica shares are still a bargain after their incredible run? If you keep an eye on value, you’re definitely not alone.
The stock has soared lately, jumping 4.5% in just the past week and posting a massive 279.3% return over the past year. The long-term gains are truly eye-catching.
Recent headlines highlight Celestica’s expansion into new technology partnerships and contract wins, fueling optimism about its future growth. These developments have turned investor attention toward the company’s transformative moves and their potential to drive lasting value.
Despite the surge, based on our six-item valuation checklist, Celestica scores 2 out of 6 for undervaluation. There is more to consider than just price momentum. Read on as we break down the usual valuation approaches and reveal a better way to understand true value at the end.
Celestica scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
A Discounted Cash Flow (DCF) model estimates a business’s value by forecasting its future cash flows and discounting them to today’s dollars. For Celestica, this approach provides a forward-looking assessment by blending analyst projections with extrapolations for the years further out.
Currently, Celestica’s Free Cash Flow stands at $379.5 Million. Over the coming years, analysts expect cash flows to grow, projecting Free Cash Flow to reach $525.6 Million by 2026 and $651 Million by 2028. Beyond those dates, cash flow estimates are derived from longer-term assumptions, with the 2035 forecast at $712.9 Million. All figures reflect nominal dollars, not adjusted for inflation, and are reported in US Dollars ($).
According to this DCF calculation, the estimated intrinsic value per share is $148.04. That is more than double the current market price, indicating the stock is 206.7% overvalued by this methodology. In short, the future growth already appears to be priced in, or even overestimated, in today’s share price.
Result: OVERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Celestica may be overvalued by 206.7%. Discover 926 undervalued stocks or create your own screener to find better value opportunities.
CLS Discounted Cash Flow as at Nov 2025
Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Celestica.
The Price-to-Earnings (PE) ratio is a widely used valuation metric for profitable companies, such as Celestica, because it directly relates the share price to the company’s bottom-line profit. For investors, the PE ratio offers a quick way to gauge whether a stock appears expensive relative to its earnings power.
Generally, higher growth expectations and lower risk justify a higher PE ratio, while slower growth or higher risks argue for a lower one. This is why looking at the PE ratios of peers and the broader industry can be helpful, but not definitive. Celestica currently trades at a PE of 51.6x. For context, its peer group averages 30.1x, while the broader electronic industry posts an average of 24.6x. By these measures, Celestica’s valuation premium certainly stands out.
To add more nuance to the comparison, Simply Wall St calculates a “Fair Ratio.” This proprietary figure estimates what PE ratio would be justified for Celestica, factoring in growth prospects, margins, risks, market cap, and industry dynamics, rather than just comparing to others. In this case, Celestica’s Fair Ratio is 52.0x, which is nearly identical to its actual PE ratio. That close alignment suggests the stock is priced just about right on this basis.
Result: ABOUT RIGHT
TSX:CLS PE Ratio as at Nov 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1437 companies where insiders are betting big on explosive growth.
Earlier we mentioned there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is your personal investment story for a company: an explanation of what you believe about its future, why, and how this translates to fair value. Instead of just relying on generic ratios, you can map out your assumptions about Celestica’s future revenue, profit margins, and risks, and connect these beliefs directly to a fair value estimate and forecast. Narratives link the company’s story, such as expansion into new AI markets, improving margins, or customer risks, with your own numbers, showing how your outlook justifies your target price.
On Simply Wall St’s Community page, Narratives turn this powerful process into an easy, accessible tool used by millions of investors. Narratives give you live feedback: as news or earnings reports are released, the numbers and narratives update, keeping your investing view current. They help you decide whether to buy or sell by showing, at a glance, how your fair value compares to today’s price.
For example, some Celestica investors expect robust revenue growth and margin expansion from AI demand, setting their fair value as high as $565.81, while others focus on risks from client concentration and assign a much lower forecast. Narratives allow you to bring your own story and strategy to life, transforming how you value Celestica.
Do you think there’s more to the story for Celestica? Head over to our Community to see what others are saying!
TSX:CLS Community Fair Values as at Nov 2025
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include CLS.TO.
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