Additional purchase before the weekend

@Keineui My dear, I think that should have been my last AI value. But the company is not just standing on its AI feet. And there should be life after AI for them too

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@Tenbagger2024 if there is still life after AI for anyone.😅🤷🏼‍♂️

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Would you like to hear the unvarnished truth? :D YOU know what I mean

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@Raketentoni hau raus.😉

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@Get_Rich_or_Die_Tryin I have adjusted the prompt a little, now it is nice and clear :)

Advance warning: If your friend has a dividend strategy, he needs to be very strong now. According to your strict set of rules ("Exclusion Rules" & "Cashflow Focus"), this will be a bloodbath - but one with extremely good growth figures.

📑 Institutional Equity Research: Celestica Inc.
Company: Celestica Inc.
Ticker: CLS (NYSE/TSX)
Current share price: ~296 USD / ~403 CAD (as of end Feb 2026, volatile after-hours)
Sector: Electronics Manufacturing Services (EMS) / AI Hardware

1️⃣ Business model & stability
Model: Contract manufacturer (EMS) for hardware. Formerly boring, now a pick-and-shovel play for AI (servers, network switches for hyperscalers like Google).

Market position: Strong in the "Connectivity & Cloud Solutions" (CCS) niche. Business is booming here (+64% growth in the segment in Q4 '25).

Cluster risk (EXTREME): This is the elephant in the room. 3 customers account for ~63% of sales (Q4 2025 data: 36%, 15%, 12%).

Verdict: High-risk dependency. If a major customer (probably Google) pulls the order, the share price collapses by 30-50%. This is not "stability", this is a ride on the razor's edge.

2️⃣ Dividend quality
Dividend: 0.00 $

Yield: 0.0

Verdict: Total failure for income investors.

3️⃣ Dividend growth
Verdict: Not applicable. (The company uses cash for growth and capex, not for distributions).

4️⃣ Free cash flow analysis
Free cash flow (FCF) 2025: approx. USD 425m (guidance/actuals).

Market capitalization: approx. USD 35 bn (strong increase).

FCF yield: 425 m / 35,000 m = ~1.2 %

Your set of rules:

5% = attractive

< 5% = only allowed with "clear growth"

Verdict: The share is expensive. The share price has run away from the cash flow. You are paying for massive future hope here, not today's cash substance.

5️⃣ Capital structure & security
Debt: Very healthy. Net debt / EBITDA is < 1.0x.

Problem: The capital risk is not in the balance sheet, but in the order book (see point 1).

Verdict: Very clean balance sheet.

6️⃣ Profitability & Return on Capital (Your Core Quality Score)
Celestica scores massively here:

Revenue Growth (2025): +28 % (explosive growth)

Operating Margin: ~7.7% (very strong for a manufacturer, target was often only 5-6%)

Your score: 28 + 7.7 = 35.7

Rule check:

25 = Very Good

Verdict: High growth quality. Operationally, the management delivers excellent results. The margin is rising, sales are soaring.

7️⃣ Valuation
P/E ratio (P/E): ~38x

History: EMS companies normally trade at P/E ratios of 10-15.

Reality check: Celestica is currently valued like a tech monopolist (Nvidia, Microsoft), but is "only" the manufacturer, which can be replaced at any time.

Peg ratio: ~0.7 (growth is so high that the high P/E ratio seems theoretically justified - but only if the growth lasts forever).

8️⃣ to 9️⃣ (dividend models)
Not applicable.

🔟 Scenario analysis
Base case: AI boom continues, Celestica continues to grow by 15-20%. Share price maintains the high level, grows into the valuation.

Bull case: Margins rise to 10% (unlikely in the EMS sector). Price target USD 350.

Bear case (the "lump" scenario): Google (customer A) shifts production to Foxconn or Jabil. Sales collapse, multiple contraction from P/E 38 to P/E 15. Target price: USD 120 (-60% downside).

1️⃣1️⃣ Risk assessment (your exclusion criteria)
❌ Stagnating sales? No, growth is top. (Passed)

❌ Op. Margin < 5%? Nein, 7,7% ist gut. (Bestanden)

❌ Dividende nicht gedeckt? Keine Dividende. (Durchgefallen für Income-Strategie)

❌ Story > Numbers? Critical. The figures are good, but the valuation (P/E 38) is based almost exclusively on the "AI story".

1️⃣2️⃣ Investment-Conclusion (The unvarnished truth)
Status for your friend:
⛔ SELL (if he is an investor) / ⚠️ HOLD (if he is a punter)

Strategy check: This has no place in a dividend portfolio. There is 0% cash return.

Risk check: The dependence on 3 customers (63% turnover) is life-threatening for the capital. A single call from a buyer at Google can halve the share price.

Valuation: The share is "priced for perfection". Every small disappointment is punished (see post-market dips).

Honest advice to the friend:
"You're riding a cannonball here. The numbers are fantastic (score 35!), but the risk is extremely concentrated. If you're in the black: take the bet off the table. This isn't a stock to 'lay down and cash in', this is a bet on the AI hardware cycle. When the music stops playing, there will be no more chairs here."

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@Raketentoni I am Munchausen and I like to ride the cannonball

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@Raketentoni I like it even better with the Promt.👌🏻🫶🏻

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@Get_Rich_or_Die_Tryin thanks, the choice of words is just awesome 😂😂😂😂

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@Tenbagger2024 😂😂😂 well you love the risk, I'll keep my fingers crossed for you

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@Raketentoni I think so too, I celebrate correctly.😂👌🏻

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ThemenmitKopf@topicswithhead

@Raketentoni You need to market this Mr. Prompt. Maybe as a stock market rapper.

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I'm looking at the stock right now and this is the first report from you that I'm really going to read in full. The repost was really good.

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ThemenmitKopf@topicswithhead

@topicswithhead what is the reason why you do not read other posts completely

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@Tenbagger2024 I find most titles too uninteresting from a business point of view and then only read the first few sentences

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PikaPika0105@PikaPika0105

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PikaPika0105@PikaPika0105

@PikaPika0105
https://www.onvista.de/aktien/kennzahlen/CELESTICA-INC-Aktie-CA15101Q2071

I see a falling P/E ratio as positive for the time being

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