Accordingly, we initiate coverage of GU with a Hold recommendation and a six-month target price of $12.00.
CyberKnife Sales Key for Accuray
Accuray, Inc. (Nasdaq: ARAY) has developed the first and only commercially available intelligent robotic radiosurgery system, the CyberKnife System, designed to treat solid tumors anywhere in the body as an alternative to traditional surgery. However, although the company believes that the System has advantages over competing products and technologies, it does not have sufficient clinical data demonstrating the advantages for all tumor indications.
Accuray's technology and system have the necessary competitive advantages over traditional treatment methods and it has been driving significantly higher revenue from the successful execution of its growth strategy. The company's ability to achieve and maintain long-term profitability is largely dependent on its ability to successfully market and sell the CyberKnife System, control costs and effectively manage growth.
NETC a Quality Brazilian Play
We are reiterating our Buy recommendation on Net Servicos (Nasdaq: NETC). Although higher worldwide inflation and interest rates, particularly in Brazil, are source of great concern, we are highly encouraged by the company's solid operating results during the first quarter. We expect this trend to continue in the short term due to the still positive economic environment in Brazil.
Brazil was recently upgraded to investment grade by Standard & Poor's and by Fitch. The outlook for Brazilian real in the short term remains positive, and that will help reduce the interest expenses in the following quarters. The incorporation of Vivax and BIGTV consolidates the company's presence in the key State of Sao Paulo. Additionally, the performance of its voice service and broadband products remains highly encouraging.
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