FONAR Corporation (FONR) | Investment Case

1. Company Snapshot

1.a. Company Description

FONAR Corporation, together with its subsidiaries, engages in the research, development, production, and marketing of magnetic resonance imaging (MRI) scanners for the detection and diagnosis of human diseases in the United States.The company operates through two segments, Medical Equipment segment, and Physician Management and Diagnostic services segment.It provides Upright MRI scanner that allows patients to be scanned in weight-bearing conditions, such as standing, sitting, bending, or lying down.

The company offers non-medical management, including administrative services, billing and collection services, credentialing services, contract negotiations, compliance consulting, purchasing IT services, hiring, conducting interviews, training, supervision and management of non-medical personnel, storage of medical records, office space, equipment, repair maintenance services, accounting, assistance with compliance matters and the development and implementation of practice growth and marketing strategies.The company owns and operates 5 diagnostic imaging facilities in Florida; and manages 39 MRI scanning facilities, including 25 facilities located in New York and 14 situated in Florida.It markets its scanners to private diagnostic imaging centers and hospitals.

The company was incorporated in 1978 and is based in Melville, New York.

Show Full description

1.b. Last Insights on FONR

FONAR Corporation's recent stock performance was negatively driven by the decline in revenue and net income in Q2 fiscal 2025. Higher costs weighed on the results, despite a 7% increase in MRI scan volumes at HMCA managed sites. However, MRI scan volumes at HMCA owned sites decreased by 4%. The company's inability to offset higher costs with growth in owned sites scan volumes contributed to the decline.

1.c. Company Highlights

Last Price	14.61
Change Percentage	-0.24%
Open	14.59
Previous Close	14.64
Market Cap ( Millions)	90
Volume	19681
Year High	17.62
Year Low	12
M A 50	15.06
M A 200	14.57

FCF Yield	8.26%
Dividend Yield	0.00%
ROE	5.72%
Debt / Equity	22.43%
Net Debt / EBIDTA	-101.84%
Price To Book	0.51
Price Earnings Ratio	9.11
Price To FCF	12.11
Price To sales	1.11
EV / EBITDA	5.38

2. Transcript Summary

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3. NewsRoom

FONAR Stock Gains Post Y/Y Decline in Q1 Earnings and Profit

Nov -14

Source: zacks.com

Fonar Announces Financial Results For The 1st Quarter of Fiscal 2026

Nov -10

Source: newsfilecorp.com

FONAR Stock Dips Post FY25 Earnings on Lower Profit and Higher Costs

Sep -17

Source: zacks.com

FONAR Announces Financial Results for Fiscal 2025

Sep -12

Source: newsfilecorp.com

FONAR's Stock Advances 5% in Three Months: Key Trends Ahead

Sep -09

Source: zacks.com

Special Committee of FONAR Board of Directors Announces Receipt of Supplemental "Take Private" Proposal

Jul -18

Source: newsfilecorp.com

FONAR Board of Directors Announces Receipt of Non-Binding "Take Private" Proposal

Jul -09

Source: newsfilecorp.com

FONAR Board of Directors Appoints Independent Director

Jul -02

Source: newsfilecorp.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.95%)

6. Segments

Management of Diagnostic Imaging Center

Expected Growth: 10.2%

Increasing demand for quality patient care, advancements in MRI technology, and growing need for efficient diagnostic imaging center management drive growth in FONAR Corporation's management of diagnostic imaging centers.

Medical Equipment

Expected Growth: 7.1%

Increasing demand for high-field open MRI systems, advancements in diagnostic imaging technology, and growing need for patient-centric care are driving the growth of FONAR Corporation's medical equipment segment.

7. Detailed Products

Upright MRI

A magnetic resonance imaging (MRI) scanner that allows patients to stand or sit during the examination, providing more accurate diagnoses and reducing claustrophobia.

Stand-Up MRI

A type of MRI scanner that allows patients to stand or sit during the examination, providing more accurate diagnoses and reducing claustrophobia.

Fonar Upright MRI Scanner

A magnetic resonance imaging (MRI) scanner that allows patients to stand or sit during the examination, providing more accurate diagnoses and reducing claustrophobia.

Fonar Workstation

A software platform that enables radiologists and clinicians to review and analyze MRI images, providing accurate diagnoses and treatment plans.

Fonar Service and Support

A comprehensive service and support program that provides maintenance, repair, and technical support for Fonar's MRI scanners and software.

8. FONAR Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

FONAR Corporation's MRI technology is highly specialized, but there are alternative diagnostic imaging technologies available, such as CT scans and X-rays. However, these alternatives are not always suitable substitutes, and FONAR's technology has a unique value proposition.

Bargaining Power Of Customers

FONAR Corporation's customers are primarily hospitals and medical imaging centers, which have limited bargaining power due to the specialized nature of FONAR's products and services.

Bargaining Power Of Suppliers

FONAR Corporation relies on a few key suppliers for components and materials, which gives them some bargaining power. However, FONAR's specialized technology and high-volume orders also give it some negotiating power.

Threat Of New Entrants

The medical imaging industry has high barriers to entry, including significant capital expenditures and regulatory hurdles. This makes it difficult for new entrants to compete with established players like FONAR Corporation.

Intensity Of Rivalry

The medical imaging industry is highly competitive, with several established players competing for market share. FONAR Corporation faces intense competition from companies like GE Healthcare, Siemens Healthineers, and Philips Healthcare.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	18.99%
Debt Cost	3.95%
Equity Weight	81.01%
Equity Cost	9.92%
WACC	8.79%
Leverage	23.44%

11. Quality Control: FONAR Corporation passed 5 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

IRadimed

A-Score: 5.7/10

Value: 0.3

Growth: 8.1

Quality: 7.9

Yield: 3.0

Momentum: 9.0

Volatility: 5.7

1-Year Total Return ->

Fonar

A-Score: 4.9/10

Value: 7.7

Growth: 2.3

Quality: 6.1

Yield: 0.0

Momentum: 6.0

Volatility: 7.3

1-Year Total Return ->

Electromed

A-Score: 4.8/10

Value: 2.9

Growth: 8.7

Quality: 7.8

Yield: 0.0

Momentum: 6.5

Volatility: 3.0

1-Year Total Return ->

UFP Technologies

A-Score: 4.0/10

Value: 3.1

Growth: 9.2

Quality: 6.6

Yield: 0.0

Momentum: 1.0

Volatility: 4.3

1-Year Total Return ->

Sensus Healthcare

A-Score: 3.4/10

Value: 7.5

Growth: 6.6

Quality: 4.2

Yield: 0.0

Momentum: 0.5

Volatility: 1.7

1-Year Total Return ->

electroCore

A-Score: 3.3/10

Value: 7.2

Growth: 7.2

Quality: 3.6

Yield: 0.0

Momentum: 0.5

Volatility: 1.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-1.82%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.79%

FONAR Corporation - US3444374058

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on FONR

1.c. Company Highlights

Better Quality

Less Volatile

Cheaper

Fairly Valued

Medium Volatility

Stable Momentum

Average Quality

Average Growth

Lower Growth

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.95%)

6. Segments

Management of Diagnostic Imaging Center

Expected Growth: 10.2%

Medical Equipment

Expected Growth: 7.1%

7. Detailed Products

Upright MRI

Stand-Up MRI

Fonar Upright MRI Scanner

Fonar Workstation

Fonar Service and Support

8. FONAR Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: FONAR Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

14.61$

Current Price

14.61$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA