Accuray Incorporated (ARAY)
NASDAQ:ARAY
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Accuray
(NASDAQ:ARAY)
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Rating:42Neutral
Price Target:
$0.35
▼(-70.09% Downside)
Action:Reiterated
Date:06/05/26
Overall score is constrained primarily by weak financial performance (margin compression, renewed losses, and negative operating/free cash flow) and a poor longer-term technical trend (trading well below major moving averages). Earnings-call visibility risk (guidance withdrawal amid geopolitical/tariff/China headwinds) also weighs on the score, while cost transformation progress and improved leverage provide partial offsets.
Positive Factors
Recurring Service Revenue
A high contract capture rate (~90%) and resilient service revenue provide durable, recurring cash flows tied to the installed base. This reduces reliance on lumpy system sales, supports steady aftermarket revenue, and creates a platform to upsell software and service packages over multiple years, improving revenue stability.
Negative Factors
Margin Compression
Sustained margin erosion from higher parts usage, tariffs, and logistics reduces operating leverage and limits free cash generation. Unless structural fixes in supply chain, pricing, or product mix occur, compressed gross margins will make it harder to convert revenue into durable profits even if top-line stabilizes.
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Positive Factors
Negative Factors
Recurring Service Revenue
A high contract capture rate (~90%) and resilient service revenue provide durable, recurring cash flows tied to the installed base. This reduces reliance on lumpy system sales, supports steady aftermarket revenue, and creates a platform to upsell software and service packages over multiple years, improving revenue stability.
Read all positive factors
Accuray Key Performance Indicators (KPIs)
Accuray (ARAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$40.60M
Dividend YieldN/A
Average Volume (3M)5.33M
Price to Earnings (P/E)―
Beta (1Y)1.92
Revenue Growth-7.88%
EPS Growth-5535.71%
CountryUS
Employees987
SectorHealthcare
Sector Strength45
IndustryMedical - Devices
Share Statistics
EPS (TTM)-0.37
Shares Outstanding118,963,700
10 Day Avg. Volume1,820,654
30 Day Avg. Volume5,333,891
Financial Highlights & Ratios
PEG Ratio0.98
Price to Book (P/B)1.73
Price to Sales (P/S)0.31
P/FCF Ratio-24.86
Enterprise Value/Market Cap4.54
Enterprise Value/Revenue0.43
Enterprise Value/Gross Profit1.60
Enterprise Value/Ebitda-28.26
Forecast
1Y Price Target
$0.35Price Target Upside-70.09% Downside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)-0.32
Revenue Forecast (FY)$424.53M
Accuray Business Overview & Revenue Model
Company Description
Accuray Incorporated specializes in the design, development, production, and sale of advanced radiosurgery and radiation therapy equipment aimed at treating tumors. Their market footprint spans across North and South America, Australia, New Zealan...
How the Company Makes Money
Accuray generates revenue primarily by selling radiation therapy systems and by providing ongoing services and software associated with those installed systems. Key revenue streams typically include: (1) Product/system revenue: one-time sales of C...
Accuray Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Aug 19, 2026
Earnings Call Sentiment Neutral
The call presents a balanced mix of positive operational progress and concerning near-term challenges. Positives include tangible early wins from the transformation program (approximately $10 million realized vs a $12 million FY2026 target), disciplined cost actions, product order momentum (book-to-bill ~1.0, 12-month 1.2), strategic hires and partnerships, and initiatives to monetize the installed base. Negatives include year-over-year revenue declines driven largely by product weakness (-13% YoY), significant margin compression (overall gross margin down ~380 basis points YoY with larger service margin deterioration), an operating loss for the quarter, tariff and parts-related cost pressure, geopolitical disruptions in the Middle East and continued China uncertainty, and the withdrawal of financial guidance. Taken together, the fundamentals show promising structural improvements and strategic clarity, but near-term top-line pressure, margin headwinds, and external uncertainty sustain material execution and visibility risk.Positive Updates
Product Orders and Backlog
Product gross orders for the quarter were approximately $49 million with a book-to-bill of 1.0 for the quarter and a trailing twelve-month ratio of 1.2. Reported order backlog of approximately $356 million (orders younger than 30 months).
Negative Updates
Year-Over-Year Revenue Decline and Product Weakness
Total revenue declined 7% year-over-year. Product revenue was $49.7 million, down 13% versus the prior year (down 15% on a constant currency basis), representing the majority of the YoY decline.
Read all updates
Q3-2026 Updates
Positive
Negative
Product Orders and Backlog
Product gross orders for the quarter were approximately $49 million with a book-to-bill of 1.0 for the quarter and a trailing twelve-month ratio of 1.2. Reported order backlog of approximately $356 million (orders younger than 30 months).
Read all positive updates
Company Guidance
Accuray withdrew financial guidance for the time being due to unpredictable geopolitical disruption in the Middle East, North Africa, Pakistan and ongoing China headwinds and said it will provide an update with fiscal Q4 results; in Q3 (ended 3/31/26) net revenue was $104.8M (≈$105M), down 7% YoY and down 10% on a constant‑currency basis but up 3% sequentially, with product revenue $49.7M (−13% YoY, −15% CC) and service revenue $55.1M (−1% YoY, −5% CC) including a $1.2M negative Middle East impact, ~90% contract capture rate, and $0.6M of service price favorability; product gross orders were ~$49M with a book‑to‑bill of 1.0 (TTM 1.2) and a backlog of ≈$356M (<30 months); overall gross margin was 24.1% (vs. 27.9% LY) with service margin 26.1% (vs. 33.3% LY) hurt by $3.2M extra parts use (~600 bps) and $0.8M of tariff impact (~150 bps), product margin 21.9% (vs. 22.7% LY) with ~$2.6M tariff cost (~530 bps); operating expenses were $34.4M (includes $6.5M nonrecurring restructuring), adjusted operating expenses fell ~$6M (−18%) YoY excluding discrete items, Q3 operating loss was $9.1M (prior year income $1.0M), adjusted EBITDA was $3.8M (vs. $6.0M LY), cash and restricted cash totaled $44.4M (down from $47.9M), restricted cash $0.4M (vs. $6.6M), net A/R $64.6M (+$3.6M QoQ), inventory $156.6M (+$5.7M QoQ), $5M drawn on the revolver, and the company has implemented ~15% workforce reductions as part of a transformation plan targeting roughly $25M of structural operating profitability improvements annually (about $12M expected to benefit FY2026, ~ $10M realized through Q3) with a goal to realize the bulk by FY2027.Accuray Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
46
Neutral
Cash Flow
29
Negative
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 428.57M | 458.50M | 446.55M | 447.61M | 429.91M | 396.29M |
| Gross Profit | 114.89M | 146.97M | 142.92M | 153.96M | 159.96M | 159.51M |
| EBITDA | -6.52M | 20.24M | 5.71M | 8.37M | 11.64M | 18.72M |
| Net Income | -46.13M | -1.59M | -15.54M | -9.28M | -5.35M | -6.31M |
Balance Sheet | ||||||
| Total Assets | 447.60M | 470.24M | 468.63M | 479.21M | 472.85M | 480.10M |
| Cash, Cash Equivalents and Short-Term Investments | 38.07M | 57.42M | 68.57M | 89.40M | 88.74M | 116.37M |
| Total Debt | 182.40M | 176.38M | 210.75M | 205.04M | 199.49M | 199.41M |
| Total Liabilities | 405.89M | 389.07M | 423.54M | 425.56M | 419.66M | 411.26M |
| Stockholders Equity | 41.71M | 81.17M | 45.08M | 53.66M | 53.19M | 68.84M |
Cash Flow | ||||||
| Free Cash Flow | -28.95M | -5.66M | -15.51M | 2.86M | -7.12M | 36.19M |
| Operating Cash Flow | -19.12M | 2.86M | -11.90M | 15.54M | -2.40M | 38.51M |
| Investing Cash Flow | -14.33M | -8.52M | -3.60M | -12.68M | -4.72M | -2.40M |
| Financing Cash Flow | -2.49M | -4.25M | -3.95M | -2.11M | -15.37M | -28.80M |
Accuray Technical Analysis
Negative
1.17
Price Trends
0.38
Negative
0.46
Negative
0.87
Negative
Market Momentum
-0.01
Positive
42.89
Neutral
23.08
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARAY, the sentiment is Negative. The current price of 1.17 is above the 20-day moving average (MA) of 0.35, above the 50-day MA of 0.38, and above the 200-day MA of 0.87, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 42.89 is Neutral, neither overbought nor oversold. The STOCH value of 23.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARAY.
Accuray Risk Analysis
Accuray disclosed 50 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
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $307.52M | 30.43 | 22.14% | ― | 16.79% | 45.17% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
49 Neutral | $70.45M | 2.37 | -514.92% | ― | 1.12% | ― | |
49 Neutral | $231.54M | -7.93 | 162.57% | ― | 39.64% | -25.99% | |
49 Neutral | $890.68M | -2.33 | -124.39% | ― | -25.74% | 2.38% | |
48 Neutral | $173.28M | ― | -12.90% | ― | 3.39% | 19.78% | |
42 Neutral | $40.60M | -0.87 | -77.48% | ― | -7.88% | -5535.71% |
* Healthcare Sector Average
ARAY
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Accuray Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Accuray Retires 2026 Convertible Notes, Simplifies Capital Structure
Positive
Jun 4, 2026
On June 1, 2026, Accuray repaid in full the remaining outstanding principal of its 3.75% Convertible Senior Notes due 2026, together with accrued and unpaid interest, and retired the securities in accordance with their original terms. The maturity...
Business Operations and StrategyFinancial Disclosures
Accuray Posts Weaker Q3 Results, Withdraws 2026 Guidance
Negative
May 6, 2026
Accuray reported fiscal third-quarter 2026 results on May 6, 2026, showing total net revenue of $104.8 million, down 7% year-on-year, with product revenue falling 13% and service revenue slipping 1%, while gross margin compressed to 24.1% on highe...
Business Operations and StrategyExecutive/Board Changes
Accuray Announces Departure of Chief Operations Officer Peralta
Neutral
Apr 28, 2026
Accuray Incorporated reported that its Senior Vice President and Chief Operations Officer, Leonel Peralta, departed the company effective April 26, 2026. The company stated that Peralta’s resignation did not arise from any disagreement with ...
Business Operations and StrategyExecutive/Board Changes
Accuray Amends Dedication Capital Consulting Agreement, Cuts Fees
Positive
Apr 7, 2026
On April 1, 2026, Accuray amended its consulting agreement with Dedication Capital, an affiliate of director Steven F. Mayer, cutting by 50% the base consulting fee after March 31, 2026, and minimum cash incentive amounts tied to the fiscal year e...
Business Operations and StrategyExecutive/Board Changes
Accuray Names Paul Miele Chief Commercial Officer
Positive
Apr 6, 2026
On April 6, 2026, Accuray appointed veteran medical-technology executive Paul Miele as Senior Vice President and Chief Commercial Officer, adding him to its executive leadership team to lead the global commercial organization. With nearly two deca...
Executive/Board Changes
Accuray Announces Transition of Chief Commercial Officer Role
Neutral
Mar 19, 2026
Accuray announced that Senior Vice President and Chief Commercial Officer Sandeep Chalke will depart the company effective March 31, 2026, under a separation agreement executed on March 13, 2026 that formalizes his transition. Under the agreement,...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.