Celestica And 2 Other Canadian Undervalued Tech Stocks To Watch
Strong US inflation concerns and missing official price data have left investors guessing about interest rates and growth. That kind of fog can push some Canadian tech stocks off the radar, even when their valuations look relatively low compared with their underlying businesses. For investors willing to do the homework, that gap can be appealing. This article highlights three Canadian technology stocks from our undervaluation screen that may warrant a closer look.
The three stocks below are just a starting sample, as the full undervalued tech screen surfaced 12 more Canadian companies with equally compelling narratives that are not covered here.
To identify those extra ideas quickly, head straight into the Undervalued Tech screener to filter, analyze, and focus on the highest conviction tech opportunities that fit your own criteria.
Celestica (TSX:CLS)
Celestica plugs directly into the Undervalued Tech theme through its hardware and supply chain work for hyperscalers, especially AI ready data center racks, while still keeping meaningful exposure to other industrial, aerospace, and HealthTech customers.
Celestica Inc. provides design, manufacturing, and end to end supply chain services for original equipment makers and cloud providers, with its Connectivity & Cloud Solutions arm generating about US$14.8b of revenue and Advanced Technology Solutions contributing roughly US$3.4b, supporting a market value near CA$36.8b.
"Accelerated demand for advanced networking and AI infrastructure by hyperscaler customers is now flowing through Celestica’s CCS outlook, with management guiding to approximately 85% CCS revenue growth in 2026 and expecting companywide revenue growth to accelerate further in 2027, which can support higher operating leverage and earnings."
What happens to Celestica’s earnings profile if a single key assumption about how this hyperscaler build out translates into long term margins breaks?
If that margin story is what you keep circling back to, read the full narrative for Celestica to see how Celestica’s AI buildout case holds up under stress tests.
CGI (TSX:GIB.A)
CGI fits within the Undervalued Tech theme through its IT modernization and cloud work. The company uses consulting, systems integration and managed services to refresh legacy systems and shift clients onto cloud infrastructure, while maintaining a broad mix across sectors and regions.
CGI Inc. runs a broad IT and business process services platform, with systems integration and infrastructure work tied to modernization and cloud. It draws sizeable revenue from regions such as Western and Southern Europe at about CA$3.0b and U.S. commercial and state clients at roughly CA$2.5b, supporting a market value near CA$24.1b.
"As CGI moves from AI pilots to embedding AI in about 65% of IT solutions and in every new managed services proposal, internal tools such as DigiOps, AIOps Nova and AI developer assistants that are already lifting revenue per employee can create further delivery efficiency and support EBIT margin resilience and earnings quality."
What ultimately matters for CGI is how one pressure on its earnings quality plays out as this AI heavy modernization work scales.
That pressure point is exactly where the story gets interesting, and the full narrative for CGI traces how CGI’s AI push could accelerate earnings quality or expose hidden fault lines.
Enghouse Systems (TSX:ENGH)
Enghouse Systems brings the Undervalued Tech theme into everyday customer interactions, with its contact center and communications software sitting alongside a broader mix of telecom, transit, and public sector platforms.
Enghouse Systems develops enterprise software across two segments, with the Interactive Management Group generating about CA$264 million and the Asset Management Group around CA$213 million of revenue, and the stock carrying a market value near CA$974 million.
"Although Enghouse Systems retains a recurring SaaS and maintenance mix of about 69% of revenue, the 8% year over year decline in total revenue to $114.3 million in Q2 2026, driven by churn in the Interactive Management Group and delayed customer projects, points to a risk that the supposedly stabilizing base fails to offset ongoing volume pressure."
The real swing factor is what happens if one pressure on that recurring engine starts to reshape how investors view Enghouse Systems’ resilience.
If that recurring churn risk is what you keep coming back to, read the full narrative for Enghouse Systems to see whether Enghouse Systems’ cash engine is stalling or quietly resetting higher.
Seeking Fresh Alternatives Beyond Tech?
Fresh ideas move first. The best breakout stories are often spotted early, while momentum is still building and information is still under the radar, so consider acting before attention broadens.
- Spot income engines that aim to keep paying even when markets swing by scanning a curated 3 dividend fortresses before yields get picked over.
- Catch fast moving AI players where cash generation still matters, not just hype, by running through a focused list of 41 profitable AI stocks that aren't just burning cash.
- Position ahead of the grid upgrade cycle and look for infrastructure suppliers geared to that shift through a filtered set of 41 power grid technology and infrastructure stocks.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com