8 Best Electronic Stocks To Buy According to Hedge Funds

5. Celestica Inc. (NYSE:CLS)

Market Cap as of October 22: $6.68 billion

Number of Hedge Fund Holders: 38

Celestica Inc. (NYSE:CLS) is an American-Canadian multinational electronics manufacturing services company that operates in multiple sites across various countries. It provides design, engineering, manufacturing, and supply chain management services to a diverse customer base across different industries. Its expertise lies in the production of complex electronic assemblies and systems, particularly in communications, computing, industrial, and medical technologies.

The company’s connectivity products for AI data centers have been in high demand, especially its 400G and 800G switches and storage solutions. Hyperscalers investing in AI infrastructure have been driving this surge, leading to a 50% year-over-year increase in connectivity revenues in Q2.

It recently unveiled its new SC6100, a high-performance 2U rackmount all-flash storage controller designed for enterprise applications. Leveraging its expertise in storage, compute, and networking solutions, the company has developed a controller powered by two AMD EPYC Embedded 9004 processors and capable of supporting up to 24 dual-port U.2 PCIe Gen 5 SSDs. This cutting-edge technology is a testament to its growth in the AI-driven market.

Revenue was up 23.33% year-over-year in Q2 2024, driven by the large-scale investments in data center infrastructure from hyper-scale customers. The Cloud and Connectivity Solutions revenue saw a 51% year-to-year increase. High-Performance Solutions revenue made up 29% of total company revenue and was up 94%. Some of the growth was offset by the decline in Advanced Technology Solutions due to continued softness in the industrial business, still accounting for 32% of total revenues in Q2.

Celestica Inc. (NYSE:CLS) appears to be well-positioned for continued growth, driven by its diverse range of high-reliability hardware platform solutions and strong focus on emerging technologies like AI. The company’s strong financial performance suggests a promising outlook for investors.