NEW YORK (TheStreet) -- Shares of Citrix Systems (CTXS) were gaining 5.9% to $69.89 Thursday morning after activist investor Elliott Management sent a letter to the software company's board of directors.
In the letter Elliott, which owns a 7.1% stake in Citrix, urged the company to sell several units and buy back shares.
The activist investor highlighted CloudBridge, CloudPlatform, and ByteMobile as "non-core," underperforming units that are distractions to the company's management. "We believe these businesses, particularly ByteMobile, should be sold or realigned," Elliot said.
Elliott Management also urged Citrix to raise debt so it can have a buyback capacity of $4.3 billion to $5.3 billion through 2017.
The activist investor said that it believes Citrix can reach stock prices of $90 to $100 or higher by the end of 2016 if the company implements its changes.
TheStreet Ratings team rates CITRIX SYSTEMS INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CITRIX SYSTEMS INC (CTXS) 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 revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and feeble growth in the company's earnings per share."