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Cognizant Technology shares rise after Elliott sends letter on enhancement plan

Cognizant Technology Solutions office in India.
Madhu Kapparath | Mint | Getty Images

Shares of Cognizant Technology Solutions gained nearly 7 percent Monday after Elliott Management sent a letter to the company outlining a three-part value-enhancement plan.

Elliott Management, which manages funds that collectively beneficially own more than 4 percent of the common stock and equivalents of Cognizant, said Cognizant could achieve a value of more than $90 plus per share by the end of 2017 by implementing the plan, according to the letter released on Monday.

"We have identified an opportunity to trim function sizes, specifically HR and finance," Elliott said in the letter.

Elliott also requested a meeting with Cognizant's board to share additional thoughts, according to the letter.

Cognizant's stock is down 5 percent year to date.

Cognizant Technology Solutions 5-Day Chart