Fonar (FONR) AI Stock Analysis

• Market Cap: $91.81M
• Dividend Yield: N/A
• Average Volume (3M): 33.34K
• Price to Earnings (P/E): 11.9
• Beta (1Y): 0.42
• Revenue Growth: 0.29%
• EPS Growth: -22.13%
• Country: US
• Employees: 520
• Sector: Healthcare
• Sector Strength: 58
• Industry: Medical - Devices
• EPS (TTM): 0.37
• Shares Outstanding: 6,203,465
• 10 Day Avg. Volume: 14,717
• 30 Day Avg. Volume: 33,341
• PEG Ratio: -0.25
• Price to Book (P/B): 0.72
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.22
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 0.28
• Enterprise Value/Gross Profit: 3.61
• Enterprise Value/Ebitda: 1.08
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 77 Outperform
• Price Target: $16.50 ▲(13.40%Upside)

Fonar's overall stock score is driven by its strong financial performance and attractive valuation. The company exhibits solid profitability and financial health, although revenue growth challenges and cash flow fluctuations are concerns. Technical analysis supports bullish momentum, but potential overbought conditions warrant careful monitoring.

Fonar Business Overview & Revenue Model

Company Description

FONAR Corporation, together with its subsidiaries, engages in the research, development, production, and marketing of magnetic resonance imaging (MRI) scanners for the detection and diagnosis of human diseases in the United States. The company operates through two segments, Medical Equipment segment, and Physician Management and Diagnostic services segment. It provides Upright MRI scanner that allows patients to be scanned in weight-bearing conditions, such as standing, sitting, bending, or lying down. The company offers non-medical management, including administrative services, billing and collection services, credentialing services, contract negotiations, compliance consulting, purchasing IT services, hiring, conducting interviews, training, supervision and management of non-medical personnel, storage of medical records, office space, equipment, repair maintenance services, accounting, assistance with compliance matters and the development and implementation of practice growth and marketing strategies. The company owns and operates 5 diagnostic imaging facilities in Florida; and manages 39 MRI scanning facilities, including 25 facilities located in New York and 14 situated in Florida. It markets its scanners to private diagnostic imaging centers and hospitals. The company was incorporated in 1978 and is based in Melville, New York.

How the Company Makes Money

Fonar Corporation generates revenue primarily through the sale of its MRI scanning systems. The company's flagship product, the Upright MRI, is a significant contributor to its income. In addition to direct sales, Fonar also earns money from service and maintenance contracts for its MRI machines, ensuring ongoing relationships with healthcare providers who require regular maintenance and technical support. Furthermore, Fonar benefits from leasing arrangements and providing ancillary services, such as assisting with the setup and installation of their MRI systems. While specific partnerships and collaborations may influence earnings, Fonar's revenue model is largely centered around sales and services related to its innovative MRI technology.

Fonar Financial Statement Overview

Summary

Fonar showcases overall financial strength with robust profitability and a solid balance sheet, complemented by prudent leverage. Despite a decline in revenue growth, the company maintains strong margins and equity ratios, supporting its stability and growth potential. However, cash flow fluctuations and revenue challenges suggest areas for improvement in sustaining long-term growth.

Income Statement

Fonar's income statement shows satisfactory performance with strong profitability metrics. The TTM period's gross profit margin stands at 35.3%, and the net profit margin is 14.2%, reflecting effective cost management and profitability. However, revenue growth has been challenging, with a decline from the previous year, indicating potential market or operational pressures. EBIT and EBITDA margins in the TTM are also healthy at 15.5% and 23.4%, respectively, showcasing operational efficiency despite revenue headwinds.

Balance Sheet

The balance sheet reflects strong financial health with a solid equity base. The debt-to-equity ratio is conservative at 0.23, highlighting low leverage and financial stability. The equity ratio is robust at 79.9%, indicating strong asset backing by shareholders' equity. Return on equity is commendable at 6.4% for the TTM, suggesting decent returns for shareholders. Overall, the balance sheet positions Fonar well for future growth and risk management.

Cash Flow

Cash flow analysis reveals positive, though fluctuating, performance. Free cash flow in the TTM is positive, but the growth rate has slowed due to increased capital expenditures. The operating cash flow to net income ratio is 1.05, indicating adequate cash generation relative to earnings. However, the decline in free cash flow compared to previous periods raises some concerns about cash sustainability if revenue growth continues to be a challenge.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
77.88M	102.88M	98.65M	97.59M	89.93M	85.69M
	Gross Profit
27.50M	45.14M	45.75M	47.01M	43.47M	42.39M
	EBIT
12.04M	16.54M	14.79M	22.01M	17.10M	8.81M
	EBITDA
18.20M	28.25M	24.61M	31.65M	23.45M	19.14M
	Net Income Common Stockholders
11.07M	10.57M	9.38M	17.23M	13.67M	11.70M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
54.38M	56.48M	51.31M	48.76M	44.49M	36.83M
	Total Assets
214.92M	214.25M	200.58M	199.34M	189.51M	180.26M
	Total Debt
39.79M	41.68M	37.01M	38.22M	34.69M	35.77M
	Net Debt
-14.47M	-14.67M	-14.27M	-10.51M	-9.77M	-1.03M
	Total Liabilities
54.66M	57.46M	49.75M	53.11M	54.14M	54.02M
	Stockholders Equity
171.88M	165.97M	157.91M	150.29M	138.42M	126.19M
Cash Flow		Free Cash Flow
8.07M	13.27M	10.13M	10.67M	14.27M	12.76M
	Operating Cash Flow
11.64M	14.09M	14.47M	15.30M	19.09M	20.40M
	Investing Cash Flow
-3.51M	-850.74K	-4.34M	-5.18M	-4.82M	7.42M
	Financing Cash Flow
-7.86M	-8.18M	-7.57M	-5.86M	-6.61M	-4.90M

Fonar Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.55
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• 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 14.55 is above the 20-day moving average (MA) of 14.25, above the 50-day MA of 13.16, and below the 200-day MA of 14.91, indicating a neutral trend. The MACD of 0.41 indicates Positive momentum. The RSI at 62.24 is Neutral, neither overbought nor oversold. The STOCH value of 44.40 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
FONR	77 Outperform	$91.81M	11.91	5.00%	―	0.29%	-22.13%
SRTS	64 Neutral	$79.10M	43.77	3.46%	―	24.75%	-61.29%
XTNT	54 Neutral	$86.73M	―	-26.20%	―	20.81%	-498.66%
Sector *	54 Neutral	$5.37B	3.26	-45.10%	3.30%	16.81%	0.02%
HYPR	51 Neutral	$56.20M	―	-67.86%	―	0.34%	6.20%
CTSO	49 Neutral	$68.25M	―	-94.65%	―	-5.86%	50.76%
ICCM	44 Neutral	$54.99M	―	-173.47%	―	0.34%	9.38%

Fonar Corporate Events

Fonar Holds Annual Stockholders Meeting and Elections

On May 19, 2025, Fonar Corporation held its Annual Meeting of Stockholders at the Hilton Long Island Huntington Hotel in Melville, New York. During the meeting, stockholders elected five directors, approved executive compensation, and ratified CohnReznick LLP as the auditors for the fiscal year ending June 30, 2025. The re-elected directors include Timothy R. Damadian, M.D., Claudette J. V. Chan, Ronald G. Lehman, Richard E Turk, and Jessica Maher.