Accuray Inc ARAY is rapidly expanding its International operations in 2015. This is evident from the fact that the company recently signed a sales agent agreement to expand in Canada. Meanwhile, 16 hospitals using its products received class A user licenses in China in February.
The sales agent agreement with Christie InnoMed Inc. for its CyberKnife and TomoTherapy System product portfolios in Canada is expected to boost Accuray’s market share in the country. Notably, Accuray had entered Canada in 2009, through the installation of its CyberKnife Robotic Radiosurgery System in Montreal.
The deal is in line with Accuray’s plans to expand through strategic partnerships and joint ventures. We note that the company has signed similar deals with Premier (Sep 2014) and Amerinet (May 2014), which are expected to boost adoption of its CyberKnife and TomoTherapy Systems in the U.S. radiation oncology community.
In China, Accuray’s TomoTherapy System licenses were received by 12 hospitals and CyberKnife System licenses were received by four hospitals. Accuray believes it will be able to recognize revenues from six out of these 16 licenses in the near future. The company expects another 10 licenses to develop into new system order, going forward.
Accuray has also started catering to breast cancer patients in Mexico City, using its TomoTherapy system. Being the first exclusive system offering surgery solutions for breast cancer patients in Latin America, the TomoTherapy system is expected to boost Accuray’s market share in the region. We believe TomoTherapy systems’ efficient delivery mode will potentially attract breast cancer centers in Latin America.
In our opinion, such growth-driven initiatives will drive Accuray’s International revenue growth in 2015 and beyond. In the second quarter of fiscal 2015, international revenues declined 11% year over year to $52.5 million, while U.S. revenues increased 31% to $45.7 million.
Zacks Rank
Currently, Accuray has a Zacks Rank #3 (Hold). Better-ranked stocks in the medical sector include Affymetrix AFFX, Luminex LMNX and Abaxis ABAX. All the three stocks sport a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment