Will Fonar Corporation Continue To Post Stellar Earnings

The Story. Fonar Corporation (NASDAQ: FONR) announced annual results for fiscal 2014 on September 15, 2014 with continuing positive earnings.  Headquartered in Melville New York, Fonar focuses on the development, manufacturing, and servicing of the Upright magnetic resonance imaging (MRI) scanners.

Leveraging on unique magnetic properties of the abundant proton atom found in our body, MRI scanners can produce beautiful images that help physicians to accurately diagnose various conditions. Moreover, the roles of MRI scanner are extensive, as they can capture pathologies ranging from the hyper metabolic rate associated with cancer cells to fractures associated with sport injuries.


Source: Fonar

During fiscal 2014, Fonar recognized $68.5 million in revenues and $13.4 million in net earnings. These figures represent 39 percent and 31 percent improvements in revenues and earnings, respectively, as compared to fiscal 2013. In addition, incomes from operations were $12.3 million: 63 percent higher than the previous year.

Fonar also earned $1.58 per share while shares outstanding remain constant at 6 million; these figures show that the company creates, rather than dilute shareholders value.

More Insight. Raymond Damadian, M.D., President and Chairman said, “the Company has grown and prospered significantly over the past year as evidenced by our outstanding financial results. This is in spite of some cuts in MRI reimbursements brought about by the Affordable Care Act. This is in large part due to the extraordinary abilities of the Upright MRI, as well as our fine management staff.”


Source: Retail Investor 360

Damadian continues, “A year and a half have passed since the acquisition of the business of Health Diagnostics Management (HDM); we can look back and see how advantageous acquiring these centers was ... By combining the resources of our wholly owned subsidiaries, Health Management Corporation of America (HMCA), and HDM, we have seen the benefits of economies of scale, shared technical and administrative expertise and capabilities, as well as joint marketing strategies."

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We initially recommended FONR to friends at the share price of $5. In 2013, we published our investment thesis to the public. We are neither long nor short FONR.

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