One-glance verdict
Undervalued
$12.61 our estimate vs market $3.82
70% below our estimate, below the bear case
Fundamentals snapshot
Accuray Incorporated
ARAY · NCM · Healthcare · Medical Devices
Current price
$3.82
52-week range
$3.55 - $47.60
Market cap
$11.46M
Balance sheet
Distressed
-0.31x Concerning
Net debt $143.25M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
3 Risks
1 rewards · 3 risks
- Reward Free cash flow was positive in 3/10 years.
- Risk Return on equity was -80.1% last year — the company lost money on shareholders' equity.
- Risk Net debt grew 23.9% over 3 years.
- Risk Insider ownership is only 4.6% (peer median: 8.2%).
What this company does
Accuray Incorporated
Accuray Incorporated sells special machines used to treat tumors with radiation, like their CyberKnife and TomoTherapy systems. Their money mostly comes from selling these machines and also from ongoing customer support and services, which helps them generate recurring revenue (money that comes in regularly from existing customers). This business model matters because it provides a steady stream of income, making it easier to predict future earnings.
How the company got here
Accuray Incorporated was founded in 1990, aiming to revolutionize cancer treatment through advanced technology. A key development was the creation of the CyberKnife system, which pioneered robotic radiosurgery. This innovation allowed for highly precise radiation delivery to tumors anywhere in the body. Over the years, the company has continued to refine its technologies, expanding its product offerings and global reach to address a wider range of cancer types and patient needs.
What it actually does
Accuray designs, develops, and sells sophisticated machines used to treat cancer with radiation. Think of them as highly advanced tools that doctors use to precisely target and destroy cancerous tumors while minimizing damage to surrounding healthy tissue. These systems are used in hospitals and specialized treatment centers worldwide to deliver radiation therapy, a common method for fighting cancer.
CyberKnife Platform
The CyberKnife platform is Accuray's flagship product, specializing in robotic stereotactic radiosurgery and stereotactic body radiation therapy. This system is designed to treat tumors located outside the brain, including those in critical areas like the spine, breast, kidney, liver, lung, pancreas, and prostate. It works by delivering high doses of radiation with extreme accuracy, guided by advanced imaging, to precisely target the tumor. This segment represents a significant portion of Accuray's business, focusing on highly precise, non-invasive tumor ablation.
TomoTherapy Platform
The TomoTherapy platform, which includes the Radixact System, offers a different approach to radiation therapy. It's a 'helical' solution, meaning it delivers radiation in a continuous spiral motion around the patient. This system integrates treatment planning (deciding how to deliver the radiation), delivery (the actual treatment), imaging (to ensure accuracy), and data management into one comprehensive package. This business line is another core revenue generator for Accuray, providing a versatile and integrated radiation treatment solution for various cancers.
Services and Support
Beyond selling its complex machinery, Accuray also generates revenue through post-contract customer support, installation, and training services. This means that after a hospital or clinic purchases an Accuray system, they can pay for ongoing maintenance, expert setup, and training for their medical staff. These services are crucial for ensuring the systems operate effectively and safely, contributing a steady stream of income and strengthening customer relationships.
What management is betting on now
Accuray's management is focused on advancing its technology to offer even more precise and effective cancer treatments. They are likely investing in research and development to enhance the capabilities of their CyberKnife and TomoTherapy systems, potentially making them faster, more accurate, or able to treat a wider range of conditions. The company is also focused on expanding its global market presence, making these advanced treatment options accessible to more patients and healthcare providers around the world. Improving the user experience for clinicians and ensuring strong customer support are also key priorities to maintain their competitive edge.
Price history
How the share price has moved
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Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q2
$927.00K
FY2025 Q3
$17.10M
FY2025 Q4
$-11.03M
FY2026 Q1
$10.28M
FY2026 Q2
$-19.01M
FY2026 Q3
$-6.07M
FY2026 Q4
$1.97M
FY2027 Q1
$-3.94M
Revenue
$86.52M
Net income
$10.13M
Diluted EPS
0.07
Operating cash flow
$-3.81M
Free cash flow
$-3.94M
Fetching…
Sources
Revenue
$100.92M
Net income
$-1.94M
Diluted EPS
—
Operating cash flow
$2.43M
Free cash flow
$1.97M
Fetching…
Sources
Revenue
$104.84M
Net income
$-11.80M
Diluted EPS
—
Operating cash flow
$-5.60M
Free cash flow
$-6.07M
Fetching…
Sources
Revenue
$102.24M
Net income
$-13.77M
Diluted EPS
-0.11
Operating cash flow
$-15.99M
Free cash flow
$-19.01M
Fetching…
Sources
Revenue
$93.94M
Net income
$-21.68M
Diluted EPS
-0.18
Operating cash flow
$12.18M
Free cash flow
$10.28M
Fetching…
Sources
Revenue
$127.54M
Net income
$1.12M
Diluted EPS
0.01
Operating cash flow
$-9.71M
Free cash flow
$-11.03M
Fetching…
Sources
Revenue
$113.24M
Net income
$-1.30M
Diluted EPS
-0.01
Operating cash flow
$18.06M
Free cash flow
$17.10M
Fetching…
Sources
Revenue
$116.17M
Net income
$2.54M
Diluted EPS
0.02
Operating cash flow
$1.80M
Free cash flow
$927.00K
Fetching…
Sources
Is it cheap or expensive?
Fair value $12.61 vs current price $3.82
Our most-likely fair value is $12.61 a share — about 230.0% above today's price of $3.82, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $143.3M. Interest coverage -0.3x.
Net debt
$143.25M
Interest coverage
-0.31x
Accuray Incorporated's profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 4 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
ARAY
BASELINE
Accuray Incorporated
Total debt $183.87M Interest coverage -0.31x This is the baseline the peer rows are being compared against.
Total debt — Interest coverage 0.34x This peer still has a real interest-payment cushion, while ARAY does not.
Total debt $3.68M Interest coverage -302.03x Neither company has much profit cushion over interest right now.
Total debt $17.07M Interest coverage -1,018.57x Neither company has much profit cushion over interest right now.
Total debt $15.73M Interest coverage -1.68x Neither company has much profit cushion over interest right now.
What you should know
The case for and against ARAY
1 Reward
3 Risks
Rewards
-
Free cash flow was positive in 3/10 years.
Risks
-
Return on equity was -80.1% last year — the company lost money on shareholders' equity.
-
Net debt grew 23.9% over 3 years.
-
Insider ownership is only 4.6% (peer median: 8.2%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-15.92x
P/B
0.27x
P/S
0.03x
EV/EBITDA
-45.65x
PEG ratio
29.49x
Profitability
How much profit each dollar creates
Gross margin
27.7%
Operating margin
6.2%
Net margin
-12.2%
ROE
-80.1%
ROA
-1.4%
Health
Liquidity and balance-sheet strength
Debt / equity
4.41x
Current ratio
1.50x
Quick ratio
0.66x
Total debt
$183.87M
Total cash
$40.62M
Growth
How the business has been compounding
Revenue TTM
$394.53M
Revenue 5Y CAGR
-1.7%
EPS TTM
-5.60
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$-22.97M
Free CF TTM
$-12.84M
FCF margin
-3.3%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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