Fonar (FONR) AI Stock Analysis

• Market Cap: $97.55M
• Dividend Yield: N/A
• Average Volume (3M): 20.83K
• Price to Earnings (P/E): 13.2
• Beta (1Y): 0.49
• Revenue Growth: 0.29%
• EPS Growth: -22.13%
• Country: US
• Employees: 520
• Sector: Healthcare
• Sector Strength: 39
• Industry: Medical - Devices
• EPS (TTM): 0.37
• Shares Outstanding: 6,203,465
• 10 Day Avg. Volume: 19,734
• 30 Day Avg. Volume: 20,833
• 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: 1.02
• Enterprise Value/Revenue: 0.28
• Enterprise Value/Gross Profit: 3.61
• Enterprise Value/Ebitda: 1.08
• 1Y Price Target: $15.50
• Price Target Upside: -3.97% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 77 Outperform
• Price Target: $17.50 ▲(8.43%Upside)

Fonar's overall stock score of 77 reflects its solid financial performance and positive technical indicators, bolstered by a favorable corporate event. The acquisition proposal by the CEO suggests a strategic move to enhance shareholder value. However, challenges in revenue growth and cash flow volatility remain areas for improvement.

Fonar Business Overview & Revenue Model

Company Description

Fonar Corporation, founded in 1978, is a U.S.-based company that operates in the healthcare sector, specifically focusing on medical imaging. It is renowned for being a pioneer in the development of MRI (Magnetic Resonance Imaging) technology. The company's core products include MRI scanners, with a specialization in upright MRI systems, which allow patients to be scanned in various positions, including weight-bearing positions. This capability is particularly beneficial for diagnosing certain conditions that may not be as apparent in traditional, supine MRI scans.

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
EBITDA	18.20M	28.25M	24.61M	31.65M	23.45M	19.14M
Net Income	11.07M	10.57M	9.38M	17.23M	13.67M	11.70M
Balance Sheet
Total Assets	214.92M	214.25M	200.58M	199.34M	189.51M	180.26M
Cash, Cash Equivalents and Short-Term Investments	54.38M	56.48M	51.31M	48.76M	44.49M	36.83M
Total Debt	39.79M	41.68M	37.01M	38.22M	34.69M	35.77M
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: 16.14
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

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 16.14 is above the 20-day moving average (MA) of 14.80, above the 50-day MA of 13.99, and above the 200-day MA of 14.74, indicating a bullish trend. The MACD of 0.48 indicates Negative momentum. The RSI at 73.59 is Negative, neither overbought nor oversold. The STOCH value of 83.17 is Negative, 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	$97.55M	13.21	5.00%	―	0.29%	-22.13%
SRTS	66 Neutral	$75.48M	41.67	3.46%	―	24.75%	-61.29%
XTNT	57 Neutral	$90.63M	―	-26.20%	―	20.81%	-498.66%
HYPR	52 Neutral	$60.64M	―	-67.86%	―	0.34%	6.20%
Sector *	52 Neutral	kr5.55B	11.43	-72.81%	7.82%	28.10%	22.23%
CTSO	49 Neutral	$69.50M	―	-94.65%	―	-5.86%	50.76%
ICCM	49 Neutral	$72.81M	―	-173.47%	―	0.34%	9.38%

Fonar Corporate Events

Fonar CEO Proposes Acquisition to Buy Outstanding Shares

On July 9, 2025, FONAR Corporation announced a proposal from CEO Timothy Damadian for a potential acquisition by a group led by him, including management and board members, to buy all outstanding shares not currently owned. The proposed acquisition offers a premium of at least 10% over the average closing price of FONAR’s stock for the 90 days before July 1, 2025, potentially impacting the company’s market positioning and shareholder value.

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.