Celestica Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Celestica Inc. (TSE:CLS) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Celestica beat earnings, with revenues hitting US$5.8b, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 12%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the current consensus from Celestica's 16 analysts is for revenues of US$40.2b in 2027. This would reflect a substantial 120% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 120% to US$21.76. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$35.4b and earnings per share (EPS) of US$19.36 in 2027. So we can see there's been a pretty clear increase in sentiment following the latest results, with both revenues and earnings per share receiving a decent lift in the latest estimates.
Check out our latest analysis for Celestica
As a result, it might be a surprise to see thatthe analysts have cut their price target 11% to CA$606, which could suggest the forecast improvement in performance is not expected to last. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Celestica at CA$631 per share, while the most bearish prices it at CA$579. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Celestica is an easy business to forecast or the the analysts are all using similar assumptions.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Celestica's rate of growth is expected to accelerate meaningfully, with the forecast 88% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 21% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 33% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Celestica is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Celestica following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Celestica going out to 2028, and you can see them free on our platform here..
However, before you get too enthused, we've discovered 1 warning sign for Celestica that you should be aware of.
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