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Accuray (ARAY) Incurs Wider Loss in Q2, Misses on Revenue
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Accuray Inc. (ARAY - Free Report) reported a loss of 11 cents per share in the second quarter of fiscal 2017, wider than the Zacks Consensus Estimate of a loss of 7 cents. Also, the loss was wider than the year-ago reported loss of 8 cents.
Total revenue decreased approximately 19.7% year over year to $87.5 million and missed our estimated $90 million. The decline was primarily due to lower sales unit volume as well as product and channel mix.
Stock Performance
Over the last three months, the stock added 16.73%, comparing favorably with the Zacks classified Medical Instruments sub-industry’s gain of 0.42%. Also, a long-term expected earnings growth rate of 15.00% instills confidence in investors.
Quarter Details
The downside in revenues was more reflected in product revenues that totaled $35.4 million compared with $55.8 million in the prior-year quarter. Also, service revenues decreased to $52.1 million from $53.2 million year over year.
In the reported quarter, gross product orders totaled $78.5 million compared with $67.1 million for the prior-year period. As of Dec 31, 2016, product backlog was $426.2 million, approximately 16% higher year over year.
Total gross profit was $31.4 million or 36% of sales, comprising product gross margin of 35% and service gross margin of 36%. This compares unfavorably with total gross profit of $42.6 million or 39% of sales, comprising product gross margin of 41% and service gross margin of 37% in second-quarter fiscal 2016.
Balance Sheet
Accuray had $08.4 million of cash and investments as of Dec 31, 2016, reflecting a decrease of $16.0 million from Sep 30, 2016, of which $5.0 million was due to secured debt principal pay down.
Guidance
Accuray projects full-year revenues in the band of $410.0 million to $420.0 million, reflecting growth of approximately 3% to 5% on a year-over-year basis, driven by continued penetration and market share gains by the TomoTherapy system. Additionally, solid momentum in CyberKnife system sales is expected to drive growth in the forthcoming quarters.
Adjusted EBITDA is anticipated in the range of $32 million to $38 million, representing year-over-year growth between 30% and 55%. Operating expenses are now projected at around $164.0 million. Backlog and gross orders are forecast to grow around 5% in fiscal 2017.
Accuray Incorporated Price, Consensus and EPS Surprise
Glaukos gained over 100% in the last one year in comparison to the S&P 500’s gain of only 19.7%. The company has a stellar four-quarter average earnings surprise of over 100%.
Cardiovascular Systems surged over 100% in the last one year in comparison to the S&P 500. It has a four-quarter average earnings surprise of 67.8%.
Neogen gained 26.0% in the past one year, better than the S&P 500 mark. The stock has an impressive long-term earnings growth of 16.7% for the next five years compared to the industry average of 15.2%.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>
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Accuray (ARAY) Incurs Wider Loss in Q2, Misses on Revenue
Accuray Inc. (ARAY - Free Report) reported a loss of 11 cents per share in the second quarter of fiscal 2017, wider than the Zacks Consensus Estimate of a loss of 7 cents. Also, the loss was wider than the year-ago reported loss of 8 cents.
Total revenue decreased approximately 19.7% year over year to $87.5 million and missed our estimated $90 million. The decline was primarily due to lower sales unit volume as well as product and channel mix.
Stock Performance
Over the last three months, the stock added 16.73%, comparing favorably with the Zacks classified Medical Instruments sub-industry’s gain of 0.42%. Also, a long-term expected earnings growth rate of 15.00% instills confidence in investors.
Quarter Details
The downside in revenues was more reflected in product revenues that totaled $35.4 million compared with $55.8 million in the prior-year quarter. Also, service revenues decreased to $52.1 million from $53.2 million year over year.
In the reported quarter, gross product orders totaled $78.5 million compared with $67.1 million for the prior-year period. As of Dec 31, 2016, product backlog was $426.2 million, approximately 16% higher year over year.
Total gross profit was $31.4 million or 36% of sales, comprising product gross margin of 35% and service gross margin of 36%. This compares unfavorably with total gross profit of $42.6 million or 39% of sales, comprising product gross margin of 41% and service gross margin of 37% in second-quarter fiscal 2016.
Balance Sheet
Accuray had $08.4 million of cash and investments as of Dec 31, 2016, reflecting a decrease of $16.0 million from Sep 30, 2016, of which $5.0 million was due to secured debt principal pay down.
Guidance
Accuray projects full-year revenues in the band of $410.0 million to $420.0 million, reflecting growth of approximately 3% to 5% on a year-over-year basis, driven by continued penetration and market share gains by the TomoTherapy system. Additionally, solid momentum in CyberKnife system sales is expected to drive growth in the forthcoming quarters.
Adjusted EBITDA is anticipated in the range of $32 million to $38 million, representing year-over-year growth between 30% and 55%. Operating expenses are now projected at around $164.0 million. Backlog and gross orders are forecast to grow around 5% in fiscal 2017.
Accuray Incorporated Price, Consensus and EPS Surprise
Accuray Incorporated Price, Consensus and EPS Surprise | Accuray Incorporated Quote
Zacks Rank & Key Picks
Currently, Accuray carries a Zacks Rank #3 (Hold).
Better-ranked medical stocks are Glaukos Corporation (GKOS - Free Report) , Cardiovascular Systems and Neogen Corp. (NEOG - Free Report) . Glaukos sports a Zacks Rank #1 (Strong Buy) while Cardiovascular Systems and Neogen carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Glaukos gained over 100% in the last one year in comparison to the S&P 500’s gain of only 19.7%. The company has a stellar four-quarter average earnings surprise of over 100%.
Cardiovascular Systems surged over 100% in the last one year in comparison to the S&P 500. It has a four-quarter average earnings surprise of 67.8%.
Neogen gained 26.0% in the past one year, better than the S&P 500 mark. The stock has an impressive long-term earnings growth of 16.7% for the next five years compared to the industry average of 15.2%.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>