Yet this quarter was first without an disappointment since the new management team took over and completely restructured the company's plans of market development. Odds of a stumble are not insignificant, given the early stage and the covid induced disfunction in the hospital world. The 12% short interest will need to cover at some point as the story progresses.
If data comes from the various clinical studies underway in 2021, as the company suggested on their call, and that data is supportive of the excellent outcomes shown in smaller, earlier studies in Amsterdam and elsewhere, 2021 could be a very strong year for orders. It would make little sense for VRAY to sell out at this point when their franchise value is only going to improve as MR-Linac continues to take ground. I believe this will put some some takeout value into VRAY stock, and that is what happened today. Therefore, I view the VAR takeover as a validation MR-Linac, and therefore a validation of VRAY's strategy. Therefore, I think they read the tea leaves and decided to take the money from Siemens. They don't have the financial resources to buy VRAY themselves, and any crash program to build their own MR-Linac would take years and money. VAR does not have one and stands to lose share if that is where the market goes.
I believe the mr-guided Linac is a better mousetrap. I suppose some people though their business would get more competitive with VAR in the hands of Siemens. I was surprised VRAY was down on Monday after the VAR buy out, but it certainly turned around today. (See ViewRay stock analysis on TipRanks) More
In addition, the $6.71 average price target implies 112% upside potential. 6 Buys and a single Hold issued in the last three months add up to a Strong Buy analyst consensus. (To watch O’Brien’s track record, click here) Like O’Brien, other Wall Street analysts are staying on board. At this target, shares could soar 89% in the next twelve months. Based on all of these factors, the five-star analyst maintained an Overweight rating and $6 price target.
VRAY COST INSTALL
He added, “We believe today’s dip represents a buying opportunity to investors willing to weather some quarterly volatility.” As recent investments from heavyweights Medtronic and Elekta boosted its capital, VRAY should be able to improve system install times as well as access potential hospital targets for the MRIdian system. “Although we do not expect this to be the last bump in the road, we remain highly confident in the utility of the MRIdian as the best technology to treat cancer patients, and we believe it will yield significant share-taking over the next couple of years,” O’Brien commented. Piper Sandler’s Matthew O'Brien did acknowledge the result was unexpected “as momentum in the order book appeared to have been building with eight orders (three upgrades) last quarter.” However, he argues that the soft order figure is indicative of “standard lumpiness capital equipment sales”, which should improve in the coming quarters. That isn’t to say investors should give up on the healthcare name. It also didn’t help that VRAY burned through about $3 million in cash. As this is down from $49 million in the prior-year quarter, it’s no wonder investors have been concerned. However, new orders largely disappointed, with this figure coming in at $21 million. VRAY announced that it expects quarterly sales of $17 million, landing very close to the consensus estimate. With this groundbreaking offering, why have shares dipped 25% year-to-date? The share price decline comes on the heels of its preliminary Q4 results. Its approach uses MRI-based technology to provide real-time imaging that clearly defines the targeted tumor from the surrounding soft tissue and other critical organs during radiation treatment. ViewRay is focused on giving clinicians new and more effective ways to treat cancer using radiation.
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