Credit Suisse on Tuesday upgraded Xerox to outperform from neutral, predicting a 39 percent rally in the stock in the next 12 months after the company's spinoff of Conduent, its services unit.



"We view the new post-split Xerox as a more focused, well-managed document technology company, with significant potential to expand OM [operating margin], and a long-term strategy to offset decline in overall print spend," equity analyst Kulbinder Garcha wrote in a note to clients.

On Tuesday, Xerox announced it had completed the separation of Conduent, which will trade under ticker CNDT, in a strategy aimed at allowing the parent company to focus on growing its digital image business.

On news of the spinoff completion, shares of Xerox rallied more than 15 percent Tuesday, tracking for their biggest daily percentage increase since November 2008.

