CLS heads into its Q2 2026 print with short sellers in full retreat and the borrow market about as relaxed as it gets.
Bears have been covering aggressively. Short interest has dropped 23% in a single week and is down 33% over the past month, leaving it at just 0.78% of free float — a level that makes short positioning effectively irrelevant as a market signal. The borrow market confirms the same story: availability is essentially unlimited, with over 114 million shares available to lend against fewer than 900,000 shares short. Cost to borrow hovers below 0.6%, down sharply from last week. The ORTEX short score has edged lower across the past two weeks, now at 26.5, consistent with a stock where conviction on the bearish side is fading. The stock itself rose 4.5% on Monday and is up 4% on the week, recovering ground after a 6% slide over the prior month.
The bull case rests on execution. Celestica's Advanced Technology Solutions segment — which serves hyperscale data centre customers — has been the engine of the recent re-rating, and bulls argue the company's expanding footprint in high-performance compute infrastructure puts it on the right side of the AI capital expenditure cycle. The ORTEX stock score sits at 78.3, with Quality leading at 87.6 on the back of an f-score of 8 and a return on assets above 11% — numbers that point to genuine operational strength. EPS momentum scores in the 80th percentile on a 90-day basis. The most recent prior earnings event produced a remarkable outcome: a 13% single-day gain followed by a further 14% over the following five sessions. The print before that saw a brief 4% dip on the day before recovering 3.6% across the week — a pattern where initial softness proved temporary.
The valuation picture is less comfortable for bulls. The stock trades at roughly 24x trailing earnings and nearly 9x book, with the price-to-book ratio having compressed by almost one full turn over the past month — suggesting the market has already done some of the re-rating work on the downside. The bear case, such as it is, centres on concentration risk: a business this levered to hyperscale server demand is exposed to any pull-forward or pause in cloud infrastructure spending. CEO Rob Mionis sold approximately C$2.7 million worth of stock across multiple tranches in mid-June at prices in the C$379–C$389 range — well below today's C$449.49 — which adds a modest counterweight to the bullish narrative, though insider selling at a TSX-listed executive level often reflects personal diversification rather than fundamental doubt. Fidelity (FMR LLC) remains the largest institutional holder at just over 6%, with Franklin Resources adding 366,000 shares in the most recently reported period.
Correlated peers painted a stark contrast on Monday: COHR fell nearly 10%, FN dropped 8%, and JBL shed nearly 3% — making Celestica's 4.5% gain look like a significant idiosyncratic move into the print rather than sector tailwind. The earnings report will therefore test whether the company's Q2 results and forward guidance can justify both the divergence from sector peers and the premium multiple that the Street is currently paying for its hyperscale exposure.
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