Radiosurgery systems maker
) announced that U.S.-based Tulsa Cancer Institute is the first
to use its latest TomoHDA System to treat cancer patients.
Earlier this month, the company expanded its footprint in France
by using this device for the treatment of the first European
The advanced fully-integrated radiation TomoHDA therapy system
combines TomoTherapy Hi-Art and Tomo HD technologies to treat all
types of cancer patients. Features such as the VoLO Technology
and the TomoEDGE Dynamics Jaws technology are available with the
TomoHDA system, which makes it the gold standard for image-guided
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
Accuray achieved a major milestone with the launch of the new
TomoTherapy H Series, featuring the TomoHDA System, at the ASTRO
meeting in Oct 2012. 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 as a specialty
device used to deliver IMRT (intensity-modulated radiation
therapy) for complex cases. The launch of the TomoTherapy H
Series, which provides treatment covering the entire spectrum of
radiation therapy patients, positions the product line in the
Adoption of new products by medical centers should boost the
company's declining top line. Adjusted revenues were down 30.5%
year-over-year at $70.6 million in the last reported quarter.
Accuray had shipped 7 and installed 14 new CyberKnife and
TomoTherapy systems during the third fiscal 2013 quarter, taking
the aggregate global installed base to 693 units. Additionally,
net new product orders jumped more than twofold sequentially,
which led to backlogs increasing 7% over the prior quarter.
Although Accuray's product order momentum, reflecting healthy
product adoption of new products encourages us, we remain
concerned over Accuray's declining top and bottom line along with
reduced full-year guidance. We are of the opinion that a lot
needs to be done to bring the company back on track. Management
needs to improve its higher-margin product revenues and
aggressively remediate its structural issues for new offerings to
fully contribute to total sales.
The stock currently carries a Zacks Rank #4 (Sell). While we
remain on the sidelines regarding Accuray, medical instrument
companies such as
) are worth considering. While CRY and BABY carry a Zacks Rank #1
(Strong Buy), HTWR carries a Zacks Rank #2 (Buy).
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