More Encouraging Progress From Accuray

Small-cap radiation oncology system manufacturer Accuray (ARAY) has frustrated more than a few investors and analysts over the years, as this company has struggled to gain real traction against Varian Medical Systems (VAR) and Elekta (OTCPK:EKTAY) (to a lesser extent) in the roughly $5.5 billion market for radiation oncology systems. While Accuray has always offered systems with some compelling technologies and capabilities, getting everything in line in terms of system reliability, performance, pricing, software, and marketing support has been a real challenge.

Maybe, just maybe, 2019 will be the year where things finally start to really come together for the company. Orders are coming in better than expected, and if the logjam in China’s market opportunity breaks up, Accuray could be poised to see significant benefits. I don’t believe enough has changed yet for me to move my fair value range from $5.50-6.50, but I do have more confidence that this story is developing in a more positive direction.

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More Encouraging Progress From Accuray