Q: Hi team,
How significant is today’s release that CLS had partnered Amd to help supply them with AI infrastructure? Seems to me this could be a big deal for CLS? That being said, the stock is only up slightly on the news. What’s holding CLS back from new highs right now other than just crappy market conditions (Iran war stability, tariffs ) ? Would you add to CLS today if a 4% position is already held?
Thanks,
Shane
How significant is today’s release that CLS had partnered Amd to help supply them with AI infrastructure? Seems to me this could be a big deal for CLS? That being said, the stock is only up slightly on the news. What’s holding CLS back from new highs right now other than just crappy market conditions (Iran war stability, tariffs ) ? Would you add to CLS today if a 4% position is already held?
Thanks,
Shane
5i Research Answer:
It is good news, and should hit CLS's revenue line later in 2026. The fact that CLS is involved in the R&D is very positive, in that it further embeds CLS into its customer operations. The sector outlook remains solid, but investors are concerned now about the war and inflation. This impacts valuations, but not fundamentals so much. CLS is still expected to show very strong earnings growth in the next two years. We do not think the AI party is ending anytime soon. We cannot comment on personal position sizes, but we would see CLS as a buy today (note it is just over 4% in our Growth Model today).