CLS heads into its April 28 earnings call with a monster guidance raise in hand, but a stock already up 48% in a month means the bar for further gains has risen sharply.
The print itself left little to quibble with. Q1 adjusted EPS of $2.16 beat the $2.07 consensus estimate. Revenue of $4.05 billion topped expectations of $3.96 billion. The company then raised full-year 2026 adjusted EPS guidance to a range implying $10.15 at the midpoint — well ahead of the $8.96 street estimate — and lifted its sales outlook to $19.0 billion versus the prior $17.0 billion target. That is a guidance step-up of roughly 12% on both lines, not a rounding error. The stock dipped in after-hours despite the result, a pattern consistent with what happened after last January's print, when CLS fell more than 18% in a single session following earnings before sliding a further 14% over the following five days.
Short sellers offer little resistance to any moves here. Short interest is barely above 1% of the free float, and has fallen roughly 22% over the past month as the stock surged. Borrow costs are negligible at 0.53% APR, and utilisation has collapsed from above 1.6% in late March to just 0.38% — a fraction of the 52-week high of 10.85%. There is no short-side pressure worth discussing; this is a momentum and valuation story now.
The valuation is the tension point bulls and bears will debate on the call. The trailing P/E has expanded to 41x and price-to-book to 13x, with EV/EBITDA running above 26x — ratios that have moved materially higher over just the past month. Factor scores tell a mixed story: EPS momentum ranks in the 76th percentile on a 90-day basis, which supports the guidance raise, but the 12-month forward EPS growth percentile ranks only in the 12th percentile, and the EV/EBIT score sits in the bottom quartile of the universe. Peers have largely moved with CLS this week — FLEX gained 11.7% and TTMI surged 18% on the week — suggesting the sector tailwind is real. But an institutional ownership shift bears watching: BlackRock nearly doubled its position last quarter, adding over 4.2 million shares, while Whale Rock cut its stake by more than 1.1 million shares over the same period.
The April 28 call is therefore less about whether CLS is growing and more about whether management can articulate a path to margin expansion and free cash flow conversion that justifies a P/E north of 40x after a 48% monthly re-rating.
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