Celestica (CLS) Reports. AST SpaceMobile (ASTS) Update
Shares of Celestica (CLS) are trading lower today after the company reported a solid beat and raise Q2 yesterday after the close. Revenue of $2.39 billion (+23%) came in 7% above consensus and adjusted EPS of $0.91 (+66%) was 10 cents ahead of consensus. Full-year guidance was raised from $9.1 billion to $9.45 billion, and EPS was raised from $3.30 to $3.62.
As expected, the Communications and Enterprise (CCS) sector, which is focused on servers and storage, is driving growth (68% of total Q2 revenue). Segment revenue grew 51% and margin was 7.2% versus 6% for the year ago quarter.
The Advanced Technology Solutions (ATS) segment (Aerospace and Defense, Industrial, HealthTech and Capital Equipment) grew by 11% and margins were about flat at 4.6% versus 4.8% last year.
The company is expanding capacity in Malaysia, Thailand and Texas to meet expected strong demand. Look at this dip below the 50-day line as a buying opportunity. BUY
AST SpaceMobile (ASTS) announced that the first five satellites (Bluebirds) are built and ready to be shipped to Cape Canaveral in early August to be ready for the 7-day launch window in September.
We’ve been waiting/expecting this announcement, but confirmation is still a big positive (ASTS is +20% today!). This will be the biggest commercial communication array in low Earth orbit and a big step forward in helping Verizon (VZ) and AT&T (T) blanket the continent with cell coverage.
Lots of speculation in this stock, but if things go as planned strength should continue. Keeping at buy half, but please realize these momentum/speculative stocks can move a lot, in both directions, depending on news flow and sentiment. We are up around 40%, factoring in today’s move. BUY HALF
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