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Accuray Incorporated (ARAY)
NASDAQ:ARAY
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Accuray
(NASDAQ:ARAY)
60Neutral
Positive Factors
Market Leadership
China has the potential to become a massive positive as Accuray is poised to become the leader in this huge emerging market.
Product Demand
Accuray Incorporated is experiencing strong demand and growth for its Cyberknife product line.
Revenue Growth
China and APAC regions are driving revenue growth significantly for Accuray Incorporated.
Negative Factors
Market Risks
The modest guidance increase recognizes challenges like potential tariffs, currency fluctuations, and capital constraints in key markets like the U.S. and Japan.
Regional Challenges
The company faces challenges in the US and EIMEA regions, with revenue declines in these areas.
Accuray (ARAY) vs. S&P 500 (SPY)
Market Cap
$171.00M
Dividend YieldN/A
Average Volume (3M)739.56K
Price to Earnings (P/E)269.5
Beta (1Y)1.81
Revenue Growth8.06%
EPS GrowthN/A
CountryUS
Employees987
SectorHealthcare
Sector Strength39
IndustryMedical - Specialties
Share Statistics
EPS (TTM)-0.01
Shares Outstanding103,013,380
10 Day Avg. Volume988,033
30 Day Avg. Volume739,556
Financial Highlights & Ratios
PEG Ratio1.84
Price to Book (P/B)2.72
Price to Sales (P/S)0.00
P/FCF Ratio7.08
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$6.50Price Target Upside308.81% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Accuray Business Overview & Revenue Model
Company DescriptionAccuray Incorporated designs, develops, manufactures, and sells radiosurgery and radiation therapy systems for the treatment of tumors in the United States, Canada, Latin America, Australia, New Zealand, Europe, the Middle East, India, Africa, Japan, China, and rest of the Asia Pacific region. It offers the CyberKnife System, a robotic stereotactic radiosurgery and stereotactic body radiation therapy system used for the treatment of primary and metastatic tumors outside the brain, including tumors on or near the spine and in the breast, kidney, liver, lung, pancreas, and prostate. The company also provides the TomoTherapy System, including the Radixact System, which allows for integrated radiation treatment planning, delivery, and data management, enabling clinicians to deliver ultra-precise treatments to approximately 50 patients per day; iDMS data management system, a fully integrated treatment planning and data management systems; and Accuray precision treatment planning system, a treatment planning and data management systems. In addition, it offers post-contract customer support, installation, training, and other professional services. The company primarily markets its products directly to customers, including hospitals and stand-alone treatment facilities through its sales organization, as well as to customers through sales agents and group purchasing organizations in the United States; and to customers directly and through distributors and sales agents internationally. Accuray Incorporated was incorporated in 1990 and is headquartered in Madison, Wisconsin.
How the Company Makes MoneyAccuray generates revenue primarily through the sale of its radiation therapy systems, namely the CyberKnife and TomoTherapy Systems. The company also earns money from service agreements, which involve providing maintenance and support services for its installed systems. Additionally, Accuray generates recurring revenue through the sale of accessories and software upgrades for its treatment platforms. The company's earnings are further supported by strategic partnerships and collaborations in the healthcare industry that help expand its global reach and enhance its technological capabilities.
Accuray Financial Statement Overview
Summary
Accuray presents a mixed financial picture with moderate revenue growth and stable gross profit margins. High leverage and low profitability are concerns, but improved cash flow metrics offer some optimism. The company needs to focus on enhancing operational efficiency and reducing financial risk to strengthen its financial position.Income Statement
Accuray's income statement shows a moderate performance with a gross profit margin of 31.5% and a net profit margin of 0.1% for TTM. The company has seen a revenue growth rate of 4.2% from the previous year, indicating a positive trend. EBIT and EBITDA margins are relatively low at 2.2% and 3.9%, respectively, pointing to limited profitability at the operating level.65
Positive
Balance Sheet
The balance sheet reveals a debt-to-equity ratio of 4.32, which indicates high leverage and potential financial risk. The return on equity is low at 1.4% for TTM, suggesting limited returns for shareholders. However, the equity ratio stands at 10.2%, showing a reasonable level of equity compared to total assets.58
Neutral
Cash Flow
Accuray's cash flow statement highlights a strong improvement with a positive free cash flow growth rate. The operating cash flow to net income ratio is 33.4, demonstrating robust cash generation relative to net income. Additionally, the free cash flow to net income ratio stands at 28.3, indicating efficient cash management.72
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 465.25M | 446.55M | 447.61M | 429.91M | 396.29M | 382.93M | Gross Profit |
| 146.44M | 142.92M | 153.96M | 159.96M | 159.51M | 149.87M | EBIT |
| 10.42M | 504.00K | 2.38M | 2.63M | 15.85M | 4.33M | EBITDA |
| 18.09M | 5.71M | 9.61M | 13.66M | 28.62M | 20.08M | Net Income Common Stockholders |
| 673.00K | -15.54M | -9.28M | -5.35M | -6.31M | 3.83M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 77.82M | 68.57M | 89.40M | 88.74M | 116.37M | 107.58M | Total Assets |
| 484.29M | 468.63M | 479.21M | 472.85M | 480.10M | 490.08M | Total Debt |
| 214.37M | 210.75M | 205.04M | 213.73M | 199.41M | 221.70M | Net Debt |
| 136.54M | 142.18M | 115.63M | 124.99M | 83.04M | 114.13M | Total Liabilities |
| 434.71M | 423.54M | 425.56M | 419.66M | 411.26M | 427.29M | Stockholders Equity |
| 49.58M | 45.08M | 53.66M | 53.19M | 68.84M | 62.79M |
| Cash Flow | Free Cash Flow | ||||
| 19.03M | -15.51M | 2.86M | -7.12M | 36.19M | -5.20M | Operating Cash Flow |
| 22.45M | -11.90M | 15.54M | -2.40M | 38.51M | -1.47M | Investing Cash Flow |
| -5.59M | -3.60M | -12.68M | -4.72M | -2.40M | -3.73M | Financing Cash Flow |
| 899.00K | -3.95M | -2.11M | -15.37M | -28.80M | 26.70M |
Accuray Technical Analysis
Neutral
1.59
Price Trends
1.65
Negative
1.90
Negative
1.90
Negative
Market Momentum
-0.03
Negative
52.57
Neutral
82.95
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARAY, the sentiment is Neutral. The current price of 1.59 is above the 20-day moving average (MA) of 1.50, below the 50-day MA of 1.65, and below the 200-day MA of 1.90, indicating a neutral trend. The MACD of -0.03 indicates Negative momentum. The RSI at 52.57 is Neutral, neither overbought nor oversold. The STOCH value of 82.95 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ARAY.
Accuray Risk Analysis
Accuray disclosed 48 risk factors in its most recent earnings report. Accuray reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Accuray Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
60 Neutral | $171.00M | 269.49 | 1.48% | ― | 8.06% | ― | |
53 Neutral | $208.51M | ― | -60.75% | ― | 4.66% | 11.33% | |
52 Neutral | $5.14B | 3.39 | -43.55% | 2.83% | 16.49% | -0.19% | |
52 Neutral | $164.97M | ― | -304.05% | ― | 28.24% | -334.39% | |
51 Neutral | $114.78M | ― | -24.73% | ― | -1.02% | -8.59% | |
50 Neutral | $137.92M | ― | -76.01% | ― | 25.62% | 11.86% | |
38 Underperform | $151.75M | ― | -61.35% | ― | 10.10% | -7.25% |
* Healthcare Sector Average
Performance Comparison
ARAY
Accuray
1.59
-0.08
-4.79%
TNGX
Tango Therapeutics
1.52
-6.27
-80.49%
LNSR
LENSAR
14.18
10.02
240.87%
SEER
Seer
2.08
-0.04
-1.89%
CVRX
CVRx
6.19
-1.89
-23.39%
SOPH
SOPHiA GENETICS
3.11
-1.50
-32.54%
Accuray Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q3-2025)
| % Change Since: 2.58%|
Next Earnings Date:Aug 14, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a company performing well against operational and financial metrics, with strong revenue growth and service business performance. However, challenges due to tariffs affecting the China market and global trade uncertainties present significant concerns.Q3-2025 Updates
Positive Updates
Solid Revenue Growth
Revenue for the third quarter grew by 12% year-over-year, driven by strong performances in both developed and emerging markets.
Strong Service Business Performance
The service business represented approximately 49% of revenue and 59% of gross margin, with service revenue growing by 9% year-over-year.
Improved Adjusted EBITDA
Adjusted EBITDA was $6 million compared to $1.1 million a year ago, driven by volume, pricing, and operational improvements.
Efficient Operational Management
The company generated $16 million of free cash flow and reduced overall inventory levels.
Healthy Customer Demand
Book-to-bill ratio was over 1.2x, driven by new customer expansion and replacement of aged equipment.
Negative Updates
Impact of Tariffs on China Market
New tariffs are expected to decrease near-term volume of product sales in China, with an estimated impact of $10 million to $15 million in Q4 revenue.
Uncertainty Due to Global Trade Policies
Visibility on near-term growth in revenues and earnings is lower due to changes in global trade policies and tariffs.
Lower Product Margins
Overall gross margin for the quarter decreased to 27.9% from 28.7% in the prior year, mainly due to incremental net China margin deferral.
Company Guidance
During Accuray's third-quarter fiscal 2025 earnings call, the company reported a 12% year-over-year revenue growth, reaching $113 million, driven by strong performances in both developed and emerging markets. Product revenues increased by 16%, while service revenues rose by 9%. Adjusted EBITDA significantly improved to $6 million from $1.1 million the prior year, primarily due to higher shipments and operational enhancements. Accuray's service business accounted for about 49% of revenue and 59% of gross margin. The company achieved a book-to-bill ratio of 1.2x, indicating robust demand with new customer expansions and equipment replacements. Despite tariff challenges affecting China, the company anticipates Q4 revenues between $121 million and $129 million and adjusted EBITDA from $9.5 million to $12 million, maintaining full-year adjusted EBITDA guidance of $28.5 million to $31 million.Accuray Corporate Events
Business Operations and StrategyFinancial Disclosures
Accuray Reports Strong Q3 2025 Financial Performance
Positive
Apr 30, 2025
Accuray reported a strong financial performance for the third quarter of fiscal 2025, with a 12% increase in total net revenue to $113.2 million and a significant reduction in net loss compared to the previous year. Despite a decrease in gross product orders and a lower order backlog, the company maintained a positive outlook, reaffirming its adjusted EBITDA guidance and adjusting revenue expectations due to tariff impacts, demonstrating resilience and strategic execution in challenging global conditions.
Spark’s Take on ARAY Stock
According to Spark, TipRanks’ AI Analyst, ARAY is a Neutral.
Accuray’s overall stock score is primarily impacted by its financial challenges, including high leverage and negative cash flows. However, strong earnings performance and strategic management changes offer potential for future improvement. Current technical indicators suggest a weak trend, but valuation remains unattractive.
To see Spark’s full report on ARAY stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.