Celestica Soared 3.36%, Can This AI-Driven Surge Sustain?

Summary
• Celestica (CLS) surged 3.36% to $208.79, breaching its 52-week high of $214.47
• Intraday range widened from $202.0 to $214.47, with turnover hitting 1.97 million shares
• CCS division revenue jumped 28% YoY to $1.84 billion, fueled by AI infrastructure demand
• RSI at 76.72 signals overbought territory, while MACD (10.89) confirms bullish momentum
Celestica’s breakout reflects surging demand for AI-powered networking solutions. With major tech firms allocating $105B-$80B+ to AI infrastructure, the stock’s 80% YTD rally faces a critical juncture. Traders must weigh technical overbought conditions against fundamentals showing robust top-line growth.

AI Infrastructure Demand Ignites Celestica’s Bull Run
Celestica’s 3.36% intraday surge stems from record $1.84 billion CCS division revenue driven by AI infrastructure orders. As Amazon, Microsoft, and Meta allocate $105B-$80B+ to AI data centers, Celestica’s high-performance servers and networking gear have become critical components. The stock’s 80% YTD gain mirrors broader AI infrastructure spending trends, with 21% revenue growth outpacing S&P 500’s 4.4% in Q1 2025. Strong order backlog and $10 billion annualized revenue position Celestica to capture AI-driven demand in cloud and HPC markets.

Communication Equipment Sector Gains Steam as Celestica Leads
The Communication Equipment sector shows mixed momentum, with Cisco Systems (CSCO) up 0.51% as sector leader. Celestica’s 3.36% gain outpaces the sector’s average 0.5% move, reflecting its AI infrastructure specialization. While RCR Wireless News highlights $16.5B Tesla AI chip deals and 5G SA expansion, Celestica’s 28% CCS growth outperforms peers like Nokia and Ericsson. The sector’s technical assessment remains bullish, but Celestica’s 40.4x P/E and 47.8x forward P/E suggest higher growth expectations compared to S&P 500 averages.

Options Playbook: Leverage AI Infrastructure Momentum with Gamma-Driven Contracts
• 200-day MA: $104.52 (far below) • RSI: 76.72 (overbought) • MACD: 10.89 (bullish) • Bollinger Bands: $141.30 (lower) to $184.47 (upper) • 52W range: $40.25-$214.47
Key levels to watch: $214.47 (52W high), $202.0 (intraday low), and $200 (round number support). With 80% YTD gains and 21% revenue growth, Celestica shows strong short-term momentum. However, overbought RSI (76.72) and elevated P/E (47.8x) suggest caution. The 2025-08-08 options chain offers two high-conviction plays:
• CLS20250808C195: Call option with 0.69 delta, 85.03% IV, $195 strike, expiring Aug 8. High gamma (0.0121) and theta (-1.05) suggest strong price sensitivity. Payoff at 5% upside (219.22): $24.22 per contract. Liquidity is robust (7,250 turnover).
• CLS20250808C197.5: Call option with 0.67 delta, 72.20% IV, $197.5 strike, expiring Aug 8. Moderate gamma (0.0146) and theta (-0.98). Payoff at 5% upside: $21.72 per contract. Volume (201,174) and turnover ($201M) confirm liquidity.
Aggressive bulls should consider CLS20250808C195 into a test of $214.47. If $200 holds, CLS20250808C197.5 offers balanced risk/reward. Both contracts benefit from high gamma exposure as Celestica approaches key resistance levels.

Backtest Celestica Stock Performance
The backtest of CLS's performance after a 3% intraday surge shows favorable results, with win rates and returns indicating positive short-to-medium-term gains. Here's a detailed analysis:1. Frequency and Win Rates: The event occurred 650 times over the backtested period. The 3-day win rate was 54.62%, the 10-day win rate was 62.46%, and the 30-day win rate was 66.46%. This suggests that following a 3% intraday surge, CLS tends to experience gains in the following days, with the probability of a positive return increasing as the time horizon expands.2. Returns: The average 3-day return was 1.09%, the 10-day return was 3.21%, and the 30-day return was 9.32%. These returns, while modest, are positive and indicate that CLS can generate gains after an initial 3% surge. The maximum return during the backtest was 18.46%, which occurred on day 59, highlighting the potential for significant gains if the surge is followed by favorable market conditions.In conclusion, the backtest indicates that CLS can be a favorable investment after a 3% intraday surge, with a high probability of positive returns in the short to medium term. However, investors should consider the overall market conditions and their risk tolerance before making investment decisions.

AI Infrastructure Tailwinds: Now or Never for Celestica
Celestica’s AI infrastructure positioning offers high-reward potential but requires disciplined risk management. With CCS revenue growing 28% YoY and major tech firms allocating $105B-$80B+ to AI infrastructure, the $208.79 level represents a critical inflection point. Traders should monitor $214.47 (52W high) and $200 support, while sector leader Cisco’s 0.51% gain indicates market confidence in communication equipment. If $202.0 support holds, the 80% YTD rally could extend; breakdown below $200 would trigger reevaluation. For now, gamma-driven options like CLS20250808C195 present compelling leverage against AI-driven demand acceleration.