Celestica (TSX:CLS) stock is down 13% in May, as shareholders book profits after a 55% rally in April. This dip is an opportunity to grab this magnificent Canadian tech stock as it rides the artificial intelligence (AI) rally. At $494, the stock might look a bit expensive as the price-to-earnings ratio is 43 times. But it is an opportunity not to miss, because another 30–50% rally is in the cards in the second half of 2026.
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Why is this magnificent Canadian tech stock a buy-and-hold for decades?
Celestica makes Ethernet switches and other network infrastructure equipment for hyperscalers and telcos. The growing AI investment called for more than just third-party manufacturing. Clients demanded product testing, after-sales services, designing, and more. Celestica used it as an opportunity to expand into design and become an original design manufacturer (ODM).
The U.S. tariffs posed threats to electronics exports, so it invested capital in building capacity and design centres in Texas, Mexico, Taiwan, and Japan.
Converting challenges into opportunities opened new growth avenues for Celestica. Its new ODM capabilities and presence in the United States saw the company secure a networking switch technology partnership for AMD’s “Helios” rack-scale AI platform.
Why look far?
Celestica’s home country, Canada, is investing billions in AI infrastructure. BCE is building an AI data centre in Saskatchewan, and Telus has announced a $66 billion investment over the next five years in networking and AI infrastructure. Celestica could benefit from these investments.
The 2026 growth prospects of this magnificent Canadian tech stock
Celestica’s Connectivity & Cloud Solutions segment has communications and enterprise clients. This year, its enterprise segment is seeing robust growth as the manufacturer has secured three hyperscaler customers, with most orders due for delivery in the second half.
A 3 times price-to-sales ratio is based on the last 12-month revenue figure. However, the company is growing its revenue by 51% year-over-year. It has also revised its 2026 revenue guidance up 12% to $19 billion, representing a 53% increase from 2025. Any new revision in guidance will drive the stock up.
Celestica’s long-term growth prospects
Apart from the 2026 growth, Celestica’s long-term growth will be cyclical. Once the first wave of AI infrastructure is over, growth will stagnate until another upgrade comes, just like communications infrastructure. However, the future cyclical rallies may not be as aggressive as the current one.
Think of it like Micron Technology (NASDAQ:MU). Micron makes memory chips for electronic devices and data centres. Its stock surges whenever companies invest in cloud infrastructure or new computers and mobile phones. The 2026 infrastructure investment is driving money to semiconductor companies. The need for sovereign AI is driving localization, creating more opportunities in major countries.
A 30% average annual growth rate can be expected from Celestica stock in the next 10 years, with a majority of the growth skewed between 2026 and 2030.
