Celestica downgraded to Neutral from Outperformer at CIBC

CIBC downgraded Celestica to Neutral from Outperformer with a price target of $49, up from $41. The company’s Q1 results and outlook for Q2 and 2024 “were excellent” as it continues to benefit from compute capacity demand from hyperscalers related to generative artificial intelligence, the analyst tells investors in a research note. However, a deceleration in its enterprise segment due to customer demand shifting to its communications segment “raises a new risk factor,” says CIBC. The firm believes it increases the possibility of slowing company growth in revenue and earnings. As a result, it expects lower growth in revenue and in earnings for the second half of 2024 and for 2025.