Q: Hello, Nice call on VRT !!! Despite the last quarter's miss, stock continued to be strongly supported by 5i and now it blew past Earnings and Guidance !! So, now, do you expect a similar performance from CLS, after close Today ? If yes, at what levels, it would make sense to add to these two companies ? We have a 1% and 1.75% position in VRT and CLS, respectively. Thank You
5i Research Answer:
BMO raised its target on CLS this week and we have no reason to expect bad results. We can't go as far as saying it will repeat VRT's performance, though. Investors were concerned about an AI slowdown, and VRT's move is partly due to strong organic growth but also partly due to 'relief' that numbers were not in fact bad. Neither stock is particularly expensive on valuation, at least compared with peers. We think $60 would be a good buy level on CLS and $88 on VRT. VRT can be a strange trader at times and thus we might be more of a 'staggered' buyer.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in VRT.