AI infrastructure boom boosts! Celestica (CLS.US) and Ciena (CIEN.US) receive Citigroup's bullish rating.

Celestica (CLS.US) and Ciena (CIEN.US) became the focus of the market on Monday, as investment bank Citigroup announced an upgrade in the former's investment rating and raised the latter's target stock price. Boosted by this news, Celestica Inc. and Ciena both closed up 6.99% and 4.76% respectively on Monday. Specifically, Citigroup upgraded its rating on Celestica from "hold" to "buy" with a target price of $375. Citigroup analyst Atif Malik stated that the US super large-scale capital expenditure by the five giants (including Oracle Corporation) is expected to grow by 75% in 2025, followed by an additional 40% in 2026. "Therefore, we expect Celestica's communication business to grow by 77% and 41% in 2025/26, and we have raised our EPS forecasts for 2025/26 fiscal years by 5% and 22%." Information shows that Celestica has two divisions, Advanced Technology Solutions (ATS) and Connectivity and Cloud Solutions (CCS). The ATS division includes the ATS terminal market, which includes aerospace and defense, industrial, health technology, and capital equipment business. The CCS division includes the communication and enterprise terminal market, with the enterprise terminal market consisting of their server and storage business. Most of the company's revenue comes from the Connectivity and Cloud Solutions division. As for Ciena, Citigroup significantly raised its target price for the stock from $141 to $230. Citigroup noted that Ciena's data center business continues to strengthen in growth momentum following Verizon's announcement of accessing Amazon.com, Inc.'s cloud service data centers. Information shows that Ciena is a telecommunications equipment supplier focusing on optical transport technology, with customers in various industries globally such as communications service providers, network scale providers, cable TV operators, government, and large enterprises. The company provides equipment, software, and services supporting transmission, switching, aggregation, service delivery, and data traffic management.