On Thursday, Accuray (NASDAQ:ARAY) Incorporated (NASDAQ:ARAY), a company specializing in radiation oncology technologies, experienced a downward revision in its stock price target by Roth/MKM. The firm reduced the target to $7.00 from the previous $9.00 but chose to maintain a Buy rating on the stock.
The adjustment follows Accuray's report of third-quarter fiscal year 2024 revenues, which showed an 11.4% decrease to $101.1 million. This figure fell short of the market consensus, which was set at $116.0 million. The company's performance was also below Roth/MKM's expectation of $114.5 million. The shortfall was primarily attributed to a slowdown in the United States, which resulted in the delay of three system installations.
Accuray's adjusted EBITDA for the quarter was reported at $1.1 million, a number that did not meet the anticipated consensus of $6.6 million. The main factors contributing to this were the revenue deficit and diminished product margins. The latter issue was partly due to the postponement of approval for precision treatment software into the fourth fiscal quarter, which in turn delayed the recognition of margins on joint venture sales in China.
The firm anticipates that the weakness in the U.S. market is likely to persist, resulting in a lowered outlook for the full fiscal year 2024. This projection takes into account the recent challenges faced by Accuray and the impact of delayed system installations on the company's financials.
InvestingPro Insights
Following the recent performance report of Accuray Incorporated (NASDAQ:ARAY), the market's response has been reflected in the company's financial metrics. According to InvestingPro, Accuray's market capitalization sits at $215.2 million, indicating the size of the company in the current market. While the P/E ratio stands at -14.57, showcasing the company's challenges in achieving profitability, the adjusted P/E ratio for the last twelve months as of Q3 2024 slightly improves to -10.01.
InvestingPro Tips for Accuray highlight that analysts are not expecting the company to turn profitable this year, and the stock is trading near its 52-week low. These factors, combined with a lack of dividend payments to shareholders, might be crucial for investors considering the company's future prospects. Notably, the company's revenue has experienced a contraction of 2.0% over the last twelve months as of Q3 2024.
For investors looking for a more in-depth analysis, InvestingPro offers additional tips on Accuray, which could help in making informed decisions. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription for further insights into Accuray's financials and future outlook.
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