Celestica Stock Leads 3 AI Infrastructure Picks With Strong Cash Generation

Energy prices are back in focus and central banks are watching them closely, which keeps attention on the power, cooling, and connectivity that AI workloads rely on. When borrowing costs and inflation are both talking points, cash generative AI infrastructure stocks can look especially interesting. This article walks through why this niche matters now and highlights 3 stocks from the AI Infrastructure Stocks screener to watch.

The three stocks below are a useful starting sample, but the full AI Infrastructure Stocks screen surfaced 54 more companies with similarly focused cash generation stories that are not covered here. To identify and analyze the highest conviction ideas across this broader group, head straight into the AI Infrastructure Stocks screener.

Celestica (TSX:CLS)

Celestica is a Toronto based electronics manufacturer and supply chain partner that builds and designs complex hardware for original equipment makers, hyperscalers and cloud providers across sectors such as communications, aerospace and industrials. The Connectivity & Cloud Solutions segment generates about US$12.3b of revenue and is the main engine tied to AI networking and data center builds. Advanced Technology Solutions adds roughly US$3.3b from areas like aerospace and HealthTech. With a market cap of about CA$50.6b, Celestica now sits firmly in large cap territory within the AI infrastructure theme.

Investors watching AI infrastructure cannot ignore Celestica. The company sits close to the action as hyperscalers roll out 800G and 1.6T networking and rack scale AI systems, and recent Q2 results and 2026 guidance point to a business already scaled into that demand. High returns on equity, expanding margins and analyst enthusiasm show why the stock has drawn attention. At the same time, heavy customer concentration and reliance on cloud and AI spending keep risk firmly on the table. The recent multi billion dollar equity raise also changes the capital structure and funding profile. The full story of how these moving parts fit together is where Celestica gets really interesting.

Celestica’s surge into large cap AI infrastructure is impressive, but the real story lies in how its cash engine and customer concentration fit together. Get the full context in the analysis report for Celestica

Build your own AI infrastructure stock shortlist

Celestica and the two other AI infrastructure stocks in this article all surfaced from a single screener, but the real edge comes from tailoring filters to what matters most to you. Use our flexible Screener to mix metrics like cash generation, valuation and balance sheet strength, or jump straight into any of our curated Investing Ideas.

Lumentum Holdings (LITE)

Lumentum Holdings supplies the lasers, optical chips and modules that let cloud and AI data centers move vast amounts of data, as well as industrial lasers for factories and EV supply chains. The company reports no segment revenue split here, but its reach is global, with material sales across the United States, Asia and Europe. With a market cap of about $63.3b, Lumentum is a large player squarely tied to AI data center connectivity and industrial manufacturing trends.

Lumentum Holdings has become a key AI optics supplier at the same time as earnings and revenue are forecast to grow quickly, helped by recent quarters of strong AI driven demand for 800G and 1.6T optical products and guidance that sits ahead of prior expectations. Forecast ROE rising from 14.8% today to almost 40% in three years points to a business that could become much more efficient, yet investors still need to weigh that against a very high P/E multiple, meaningful debt and recent insider selling. The real question is whether the current AI build out and margin strength can translate into durable free cash flow before the next hardware cycle turns.

Lumentum’s fast shifting AI optics story and the gap between current earnings and future expectations raise big questions. Move through the analyst forecasts for Lumentum Holdings to see what could close that gap or expose a pressure point.

Vertiv Holdings Co (VRT)

Vertiv Holdings Co builds the power systems, liquid and air cooling, and racks that keep AI and cloud data centers running, along with services to install, monitor, and maintain that infrastructure for customers worldwide. Most revenue comes from the Americas at about $7.5b, with Asia Pacific contributing roughly $2.7b and Europe, the Middle East & Africa around $2.4b, partly offset by intersegment sales. Vertiv’s market cap of roughly $104b now reflects its role as a core supplier to large scale digital infrastructure.

Vertiv is attracting attention because it sits at the heart of the AI power and cooling build out, with a business that stretches from hardware into higher margin lifecycle services and partnerships alongside major chipmakers. Earnings and margins are already strong; yet the stock trades on a rich P/E, relies on external funding, and has a relatively new management team, which means any stumble on guidance or hyperscaler spending can hit sentiment hard. The interest lies in how those risks stack up against strong order momentum, a large backlog tied to AI data center projects, and a rapidly growing liquid cooling and services offering that could reshape how investors think about the company over the next few years.

Vertiv’s accelerating role in AI power and cooling often gets reduced to a simple growth story, yet the real intrigue lies in how its mix of hardware, services and funding stacks up in the analysis report for Vertiv Holdings Co

Seeking Fresh Alternatives Before They Fly

Markets move fast, and the next breakout list rarely stays under the radar for long. Scan these fresh stock ideas before the crowd catches on and act now.

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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.

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