The Smartest Growth Stock to Buy With $2,500 Right Now

Some of the smartest growth stocks are those that ride technology rallies irrespective of the tech revolution. They never get the limelight.

Puja Tayal

Author Bio

Puja Tayal grew up in a small-business family where dinner conversations often centred on working capital and savings. Her early experiences with investing, particularly during the 2008 financial crisis, shaped her approach to understanding markets and evaluating investment opportunities. She began her career at a mutual fund company before moving into investor education and financial writing for asset and wealth management firms. Before joining The Motley Fool, Puja wrote for Market Realist, where she extensively covered the semiconductor industry. Her published work has also appeared in The Indian Express. Puja believes every stock has a story that can help investors understand its potential returns. She combines business analysis with different investing approaches to help investors make informed decisions and align their portfolios with their long-term financial goals. Outside of finance, Puja enjoys long drives, catching up with friends, watching superhero and science-fiction movies, and managing her family portfolio. She also has a keen interest in artificial intelligence and its potential to reshape the world.

Education

Bachelor's degree in Accounting and Finance, University of Mumbai (2007)
CFA Level I

Areas of Expertise

Qualitative company analysis, management strategy, risk assessment, long-term investing, portfolio diversification and rebalancing, dividend reinvestment, cyclical growth opportunities, compounding strategies, growth stocks, and dividend stocks.

Social Media Profiles

Favorite Investment Quote

"Risk comes from not knowing what you're doing." — Warren Buffett

Published June 12, 2025 3:45 pm EDT

Tariff or no tariff, the artificial intelligence (AI) revolution is coming. While it is difficult to determine who will lead the AI race, one thing for certain is the need for data centres and networking infrastructure. An AI-enabled device is just a piece of hardware if not connected to the internet or cloud. It has driven the demand for network switches. Nvidia is the most obvious for AI hardware, but other stocks are also benefiting from AI investments. These tech stocks are a smart choice for strong growth, other than the obvious choice.

A microchip in a circuit board powers artificial intelligence. — Source: Getty Images

The smartest growth stock to buy with $2,500

While Nvidia designs data centre graphics processing units (GPUs), it does not manufacture them. The growing investment in research and design has given rise to third-party electronics manufacturers. The demand has created cyclical growth for such manufacturers.

Among the beneficiaries was Celestica (TSX: CLS), which manufactures servers, storage, and networking solutions for Communications and Enterprises. It reports the revenue from this under the Connectivity & Cloud Solutions (CCS) segment. It also has a segment Advanced Technology Solutions (ATS) for Aerospace and Defense, Industrial, HealthTech, and Capital Equipment businesses. But the real growth is coming from CCS.

After strong double-digit revenue growth in the high-margin Enterprise segment during the 2022–2024 period, Celestica’s revenue growth has moderated. It has guided 2025 revenue growth of high teens.

But the major reason for Celestica stock’s 54% dip between February and April 8, 2025 was Trump’s tariffs on Canadian imports. However, the stock recovered and surged 78% since April 8, when the US government announced temporary exemptions for key data centre IT hardware, including servers and networking switches.

Is there more upside for this growth stock?

The recent rally was a recovery from the uncertainty around tariffs. Celestica is seeing strong demand for network switches and controllers. The company has launched a high-performance 800G family of network switches for AI-powered data centres. It expects demand for servers to pick up in the second half and drive revenue and profits.

The company has revised its 2025 revenue guidance upwards from $10.7 billion to $10.85 billion. It has also increased its adjusted operating margin guidance from 6.9% to 7.2%. The 2025 guidance justifies the 1.43 times price-to-sales (P/S) ratio and 24.5 times forward price-to-earnings (P/E) ratio.

Celestica’s growth is not in isolation. Its U.S. competitor, Flex (NASDAQ: FLEX), also saw a recovery rally of 63.5% from April 7 onwards, showing a new wave of growth momentum. Flex is trading at a P/S ratio of 0.67 times and a forward P/E ratio of 14.2 times, lower than Celestica.

Despite high valuations, Celestica is a better buy. Why?

Flex expects its revenue to fall or rise mid-single digits as strength in cloud and networking is offset by weakness in automotive, consumer devices, renewables, and industrial. Its exposure to diverse verticals has slowed its revenue growth.

Investing $2,500 in Celestica right now

You could consider investing $2,500 in Celestica now and expect a seasonal rally in the second half of 2025 driven by enterprise demand. Once the trade war is over and economic growth revives, demand could grow further as companies that have paused network investments amid tariff uncertainty proceed.

Celestica is a stock to buy and hold for the long term, as the move to promote local manufacturing could drive demand for third-party electronics manufacturers. Celestica’s high exposure in Communications and Enterprise verticals could drive its stock price in the AI and 5G revolution.