Why Synchronoss Technologies Stock Soared Today

What happened

Shares of Synchronoss Technologies (NASDAQ: SNCR) popped 10.8% Tuesday after Roth Capital analyst Richard Baldry initiated coverage on the cloud-based enterprise computing and messaging specialist with a buy rating. Baldry also assigned a $13-per-share price target on Synchronoss, representing a massive 95% premium from Monday's close of $6.67.

Stock market charts on a colorful display indicating gains.
Stock market charts on a colorful display indicating gains.

Image source: Getty Images.

So what

Synchronoss was already having a decent month before this initiation; shares enjoyed a similar single-day leap as the market cheered the company's longer-term growth, sales, and capital-allocation strategies outlined during an investor day almost two weeks ago.

To that end, in a note to clients obtained by TheFly today, Baldry justified his bullishness by pointing to a combination of Synchronoss' "depressed valuation," and its "unique set" of cloud-based products that cater to "important new strategic growth avenues for a broadening set of potential customers."

Now what

That's not to say anything has technically changed apart from Synchronoss' share price. But with the stock trading at a small fraction of its all-time highs set a few years ago, and given this vote of confidence from Wall Street -- in particular the steep rally this analyst is predicting -- it's no surprise to see Synchronoss jumping in response today.

More From The Motley Fool

Steve Symington has no position in any of the stocks mentioned. The Motley Fool recommends Synchronoss Technologies. The Motley Fool has a disclosure policy.