Tuesday, November 9, 2010

J.P. Morgan Reiterates Neutral Rating on Accuray

from www.poten.com:

>>J.P. Morgan is out with a research report this morning, where it reiterates its Neutral rating on Accuray (NASDAQ: ARAY); it has a $6.00 price target on the stock.

The J.P. Morgan analysts cited the company's recently reported earnings report, which was in-line with the expectations.

With revenues down, low visibility, an improving but still-cautious hospital capex market, and increased competition, the analysts do not see a near-term catalyst for either multiple expansion or an inflection toward profitability and as the stock is most likely to remain range-bound in the near-term.

As for valuation, the analysts noted, “We value ARAY on an EV/CY11E sales basis, and apply a 0.9x multiple (discount to the peer group) to our CY11 sales estimate to arrive at our Dec 2011 price target of $6.”

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