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Shares of Xerox Corporation (XRX –Analyst Report) hit a 52-week high of $12.08 during yesterday’s trading session. However, the stock closed the session at $12.03, which reflects a solid year-to-date return of 67.3%. The average trading volume aggregated 8.8 million shares.

Screen Shot 2013-12-23 at 12.26.21 PMXerox recently upped the quantum of its bond offering after an upgrade of investment grade rating from BBB- to BBB by global credit rating agency Standard & Poor’s. The boost in the credit rating by one notch has enabled the company to raise bond offering to $500 million from $300 million planned earlier. At the same time, Xerox generates significant cash flow and deploys it to maximize shareholder value. These are some of the catalysts driving the stock.

Growth Drivers

Xerox expects continued demand from small and midsize businesses in the United States and positive trends in the high-end of its business going forward.

Screen Shot 2013-12-20 at 2.22.38 PMIn order to better adapt to the changing market trends, Xerox is also continually shifting its business model by expanding indirect distribution channel and streamlining its supply chain and product portfolio. Going forward, the company expects to increase revenues from the Services segment to 66% of total revenue by 2017.

To achieve this objective, Xerox is focusing more on vertical markets like healthcare. The company has already begun to reap huge benefits from Medicaid Management Information System (MMIS) through the successful implementation and CMS (Centers for Medicare and Medicaid Services) Certification in 31 state Medicaid program.

Screen Shot 2013-10-18 at 12.46.01 PMThe increase in contract value of service signings and the growing pipeline are strong indicators for robust growth of the company. At the same time, Xerox is continuing its thrust for leadership in Document Technology with innovative products in order to meet the demands of customized communications in digital printing.

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