Accuray Executing More Consistently, Now Waiting For China To Kick In

As I have said in the past, although the share price really doesn’t reflect it, Accuray’s (ARAY) CEO has done a good job of stabilizing and turning around this business. Product quality and service delivery issues are long since resolved, margins have improved noticeably, and debt has skillfully managed. On top of that, the company has been rolling out product and software upgrades that meaningfully address competitive weaknesses and improve the value of the system to hospitals, and the company has successfully closed a long-awaited JV for the large China market.

And now… we wait. Outside of the China opportunity Accuray remains an “is what it is” business, with the company picking up only modest market share (primarily from Elekta (OTCPK:EKTAY) and old Siemens installations). Not much has really changed about the U.S. market, where Accuray is still generally a distant afterthought, and the Japanese business can’t do it all alone. I do believe these shares remain undervalued, but a lot is riding on the China opportunity, and both Elekta and Varian (VAR) are keenly focused here too, while ViewRay (VRAY) chips away a bit at the U.S. market opportunity.

Read more here:
Accuray Executing More Consistently, Now Waiting For China To Kick In