Back to top

Analyst Blog

Radiosurgery systems maker, Accuray Incorporated (ARAY - Analyst Report) announced that Germany-based Heidelberg University Hospital is the first to use its latest Tomotherapy technology for patient treatment. The new TomoEDGE Dynamic Jaws technology combined with VoLO Planning as part of its TomoTherapy System was introduced at the ASTRO meeting in Oct 2012.

Accuray had acquired Wis.-based radiation system maker TomoTherapy in Jun 2011. TomoTherapy markets advanced radiation therapies for treating multiple cancer types. The TomoTherapy Systems are advanced radiation therapy systems, which provide precise and safe radiation therapy by combining CT imaging and radiation treatment delivery in a single device, thereby lowering side-effects.

Accuray had achieved a major milestone with the launch of the new TomoTherapy H Series, featuring the TomoHDA System, at the ASTRO meeting. This unique series is considered to be the near-term growth driver for the company. Prior to the ASTRO meeting, the TomoTherapy System occupied a niche position in the market, as it was considered to be a specialty device used to deliver IMRT for complex cases. The launch of the TomoTherapy H Series for treatments that cover the entire spectrum of radiation therapy patients, positions the product line in the mainstream market.

The advanced TomoEDGE technology is capable of providing precise dosage of radiation in a lesser time frame. This allows for more treatments per day without compromising on clinical efficiency.  

The company had also launched a new CyberKnife M6 System at the ASTRO meeting in 2012. The unmatched FDA-approved series is capable of treating large, complicated tumors (which were rendered untreatable earlier), thereby expanding the number of patients that can benefit from this treatment. In Feb 2013, the European CyberKnife Center Munich-Grosshadern (ECZM), a global pioneer in radiosurgery, treated the world's first patient with the new CyberKnife M6 System.

Accuray is currently going through a rough phase with losses widening and product revenues declining at a rapid rate. Its legacy CyberKnife system sales are also declining. Management cited certain internal issues that led to delay to the launch of its latest technologies and widening of losses. In an effort to remediate the shortfall, the company announced a major restructuring program and issued convertible notes to strengthen its balance sheet, which appears to be encouraging.

The stock currently carries a Zacks Rank #3 (Hold). While we remain on the sidelines regarding Accuray, medical instrument companies such as Cepheid (CPHD - Analyst Report), Given Imaging and Abiomed (ABMD - Analyst Report) are worth considering. While Cepheid and Given Imaging carry a Zacks Rank #1 (Strong Buy), Abiomed carries a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
ERBA DIAGNO… ERB 3.00 +3.09%
SANCHEZ ENE… SN 34.18 +2.67%
THE PANTRY… PTRY 21.02 +2.09%
INTEL CP INTC 35.15 +1.88%
PIPER JAFFR… PJC 54.54 +1.70%