Citi upgraded its rating for Celestica from 'Hold' to 'Buy', with a price target of $375. For Ciena, Citi significantly raised its price target for the stock from $141 to $230.
According to Zhitong Finance, Celestica (CLS.US) and Ciena (CIEN.US) were in the market spotlight on Monday after Citi announced an upgrade to the former's investment rating and raised the latter’s target price. Following the news, Celestica and Ciena closed up 6.99% and 4.76%, respectively, on Monday.
Specifically, Citi upgraded its rating for Celestica from "Hold" to "Buy," with a target price of $375. Citi analyst Atif Malik noted that capital expenditure by U.S. hyperscalers, including Oracle, is expected to grow by 75% in 2025 and by an additional 40% in 2026. "As such, we project that Celestica’s communications business will grow by 77% and 41% in 2025 and 2026, respectively, and have raised our EPS forecasts for fiscal years 2025 and 2026 by 5% and 22%, respectively."
Celestica operates through two segments: Advanced Technology Solutions (ATS) and Connectivity & Cloud Solutions (CCS). The ATS segment serves end markets including aerospace and defense, industrial, health technology, and capital equipment businesses. The CCS segment includes communication and enterprise end markets, with the enterprise end market comprising server and storage businesses. The majority of the company’s revenue comes from the Connectivity & Cloud Solutions segment.
For Ciena, Citi significantly increased its target price for the stock from $141 to $230. Citi pointed out that following Verizon’s (VZ.US) announcement that it would access Amazon’s (AMZN.US) cloud service data centers, Ciena's data center business has continued to gain strong momentum.
Ciena is a telecommunications equipment supplier specializing in optical transport technology, serving clients across multiple global industries such as communications service providers, hyperscale providers, cable operators, governments, and large enterprises. The company offers equipment, software, and services that support transmission, switching, aggregation, service delivery, and data traffic management.
