Fonar (FONR) AI Stock Analysis

• Market Cap: $116.80M
• Dividend Yield: N/A
• Average Volume (3M): 29.06K
• Price to Earnings (P/E): 16.5
• Beta (1Y): 0.20
• Revenue Growth: 3.36%
• EPS Growth: -21.15%
• Country: US
• Employees: 520
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): 0.31
• Shares Outstanding: 6,173,008
• 10 Day Avg. Volume: 24,606
• 30 Day Avg. Volume: 29,056
• PEG Ratio: -0.59
• Price to Book (P/B): 0.55
• Price to Sales (P/S): 0.91
• P/FCF Ratio: 12.69
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 0.96
• Enterprise Value/Gross Profit: 2.35
• Enterprise Value/Ebitda: 6.21
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: $20.00 ▲(42.15% Upside)
• Action: Reiterated Date: 02/14/26
• Date: Action: Reiterated 02/14/26

The score is driven primarily by weakening financial performance (sharp TTM revenue decline, margin and cash-conversion pressure, and a loss-making MRI equipment segment) offset by a stable balance sheet and constructive technical momentum. Valuation is moderate but lacks dividend support.

Positive Factors

Recurring diagnostic imaging services model

Fonar’s core revenue comes from operating MRI centers and delivering scans, a recurring service tied to referral relationships, payer billing and collections. This service-based model provides more predictable cash flow than one-off product sales and supports steady operating income over time.

Conservative balance sheet with low leverage

Reported debt-to-equity near 0.22–0.25 and steadily building equity indicate low financial leverage. That conservative capital structure supports resilience through revenue softness, preserves strategic flexibility for capex or restructuring, and reduces solvency risk over the medium term.

Insider-led take-private agreement

An insider-led merger to take the company private aligns management and owners and can enable longer-term restructuring away from quarterly public scrutiny. If completed, this could allow focused investment or reorganization of the loss-making equipment segment and streamline decision-making.

Negative Factors

Sharp TTM revenue decline

A roughly 22% TTM revenue decline is a durable headwind that reduces operating scale and limits fixed-cost absorption. Lower top-line momentum pressures margins, curtails reinvestment capacity in centers or technology, and weakens the company’s ability to execute growth initiatives over the coming quarters.

Weakened cash conversion and free cash flow

Operating cash flow covering only ~64% of earnings and FCF at ~62%—with FCF down ~24% TTM—indicate deteriorating cash quality. Persistent lower cash conversion constrains capital spending, debt service flexibility, and the ability to fund network upkeep or absorb payer/reimbursement pressure over the medium term.

Loss-making MRI equipment segment

The legacy MRI equipment business is loss-making while imaging centers supply operating income. A continued unprofitable equipment segment drags consolidated margins, diverts management focus and capital, and increases earnings volatility unless addressed through restructuring or strategic exits.

Fonar Business Overview & Revenue Model

Company Description

Fonar Corporation (FONR) is a medical technology company focused on the development and manufacturing of advanced magnetic resonance imaging (MRI) systems. The company operates primarily in the healthcare sector, providing innovative imaging solutions that enhance diagnostic capabilities for medical professionals. Fonar's core products include its patented upright MRI systems, which allow patients to be scanned in weight-bearing positions, resulting in improved diagnostic accuracy and patient comfort.

How the Company Makes Money

Fonar generates revenue primarily through the sale of its MRI systems and related equipment to hospitals, diagnostic centers, and medical facilities. The company also earns income from service and maintenance agreements for their MRI machines, providing ongoing support and upgrades to clients. Additionally, Fonar has established partnerships with healthcare providers and research institutions that may contribute to revenue through collaborative projects or shared clinical studies. The company's ability to capitalize on its niche market of upright MRI technology, coupled with ongoing service contracts, significantly contributes to its overall earnings.

Fonar Financial Statement Overview

Summary

Still profitable and conservatively levered, but fundamentals have weakened: TTM revenue fell ~22%, margins compressed versus prior years, and cash conversion/FCF declined. Segment KPIs show imaging centers driving operating income while MRI equipment remains loss-making, which limits overall quality despite balance-sheet resilience.

Income Statement

Profitability remains solid, with TTM (Trailing-Twelve-Months) net margin around 12% and operating profitability in the low double-digits, but results have softened versus prior years. The biggest issue is growth: TTM (Trailing-Twelve-Months) revenue declined ~22% after several years of modest positive growth, and margins have generally compressed from the stronger 2022–2024 period. Overall, still profitable, but the recent top-line drop and lower profitability trajectory weigh on the score.

Balance Sheet

The balance sheet appears conservatively levered, with debt-to-equity around 0.22–0.25 across periods and equity steadily building over time. Returns on equity are positive but have moderated (TTM (Trailing-Twelve-Months) ~4% vs. higher levels in prior years), suggesting reduced earnings power rather than balance-sheet strain. Overall financial risk looks contained, with the main drawback being the recent decline in shareholder returns.

Cash Flow

Cash generation is positive, but quality and momentum have weakened. In TTM (Trailing-Twelve-Months), operating cash flow covers a smaller share of earnings (about 0.64x) and free cash flow is only ~0.62x of net income, both down from stronger conversion levels in earlier years (notably 2024). Free cash flow also declined in TTM (Trailing-Twelve-Months) (~24% down), pointing to pressure on cash conversion despite continued profitability.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	106.03M	104.35M	102.88M	98.65M	97.59M	89.93M
Gross Profit	43.26M	85.22M	45.14M	45.75M	47.01M	43.47M
EBITDA	16.36M	16.30M	21.13M	24.61M	26.54M	21.18M
Net Income	7.56M	8.33M	10.57M	9.38M	12.44M	10.21M
Balance Sheet
Total Assets	217.22M	216.91M	214.25M	200.58M	199.34M	189.51M
Cash, Cash Equivalents and Short-Term Investments	53.10M	56.45M	56.48M	51.31M	48.76M	44.49M
Total Debt	39.80M	38.92M	41.68M	37.01M	38.22M	34.69M
Total Liabilities	54.36M	56.80M	57.46M	49.75M	53.11M	54.14M
Stockholders Equity	177.23M	172.61M	165.97M	157.91M	150.29M	138.42M
Cash Flow
Free Cash Flow	5.72M	7.45M	13.27M	10.13M	10.67M	14.27M
Operating Cash Flow	9.22M	11.26M	14.09M	14.47M	15.30M	19.09M
Investing Cash Flow	-4.01M	-3.80M	-850.74K	-4.34M	-5.18M	-4.82M
Financing Cash Flow	-5.82M	-7.47M	-8.18M	-7.57M	-5.86M	-6.61M

Fonar Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.07
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FONR, the sentiment is Positive. The current price of 14.07 is below the 20-day moving average (MA) of 18.58, below the 50-day MA of 17.89, and below the 200-day MA of 15.77, indicating a bullish trend. The MACD of 0.16 indicates Positive momentum. The RSI at 65.14 is Neutral, neither overbought nor oversold. The STOCH value of 69.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FONR.

Fonar Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VMD	72 Outperform	$330.76M	26.32	10.53%	―	18.90%	29.22%
FONR	66 Neutral	$116.80M	16.52	4.34%	―	3.36%	-21.15%
XTNT	66 Neutral	$79.84M	55.88	3.64%	―	16.88%	―
VREX	52 Neutral	$551.82M	-7.91	-13.95%	―	4.14%	-45.29%
CTKB	52 Neutral	$575.90M	-8.62	-18.05%	―	-2.18%	-30.96%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
NNOX	47 Neutral	$151.12M	-2.68	-34.75%	―	15.19%	-3.32%

Fonar Corporate Events

Fonar to Be Taken Private in Insider-Led Merger

On December 23, 2025, FONAR Corporation entered into a merger agreement under which FONAR, LLC, an acquisition vehicle led by CEO Timothy Damadian and other company insiders, will acquire all outstanding FONAR shares and take the company private via a cash transaction that values common and Class B shares at $19.00, Class C shares at $6.34 and Class A preferred shares at $10.50. An independent special committee and the disinterested board members unanimously deemed the deal fair and in the best interests of stockholders, and the transaction—backed by a $35 million bank facility, at least $10 million of additional debt financing and at least $45 million of equity commitments—remains subject to approval by both a majority of all voting shares and a separate majority of disinterested shareholders, as well as regulatory clearances, after which FONAR’s stock would be delisted from Nasdaq and deregistered, shifting control firmly to the insider-led buyer group and eliminating public-market liquidity for current investors.

The most recent analyst rating on (FONR) stock is a Hold with a $15.50 price target. To see the full list of analyst forecasts on Fonar stock, see the FONR Stock Forecast page.