NEW YORK (TheStreet) -- Nuance Communications (NUAN) stock is gaining by 5.51% to $17.51 in late morning trading on Wednesday, following a rating upgrade to "outperform" from "market perform" at Raymond James this morning.
Raymond James has a $22 price target on Nuance Communications stock.
The firm said it upped its rating on the company based on its belief that Nuance has evolved from an acquisition led growth focus to a focus on improving its internal operations.
Raymond James is also expecting the company's cost-cutting plans to result in above consensus earnings results for next year.
"We view Nuance as a company with many growth businesses and many declining businesses, but in aggregate a reasonably mature top line growth profile, which is now being managed as such. We expect the valuation to improve as recent cost-cutting initiatives bear fruit in the form of EPS upside to consensus (likely in 2016)," the firm said in an analyst note.
Separately, TheStreet Ratings team rates NUANCE COMMUNICATIONS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate NUANCE COMMUNICATIONS INC (NUAN) a HOLD. The primary factors that have impacted our rating are mixed-some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."