What happened

After reporting encouraging fiscal 2019 first-quarter results, shares of Accuray (NASDAQ:ARAY), a medical device company that makes the CyberKnife Stereotactic Radiosurgery System, were up 35% as of 2:00 p.m. EDT on Wednesday.

So what

Here's a look at the key numbers from the quarter:

  • Revenue increased 5% to $95.8 million. That was a smidge higher than Wall Street was expecting.
  • Net loss was $9.2 million, or $0.11 per share. That was worse than the $0.09 loss that analysts had predicted.

Looking beyond the numbers, management stated that China's Ministry of Health announced Type A and B quotas and licenses and that it is planning on cutting annual operating costs by $15 million to get the company on a path to profitability.

Doctor putting his hand on an elderly patient.

Image source: Getty Images.

In response to these recent news items, the company now expects full-year revenue growth of 3% to 5% and full-year adjusted EBITDA between $23 million and $29 million.

When combined with Accuray's beaten-down share price -- shares had fallen nearly 30% over the last year prior to today's jump -- it is understandable that Accuray's long-suffering bulls are finally having a good day.

Now what

I think that Accuray makes an interesting product that serves a real need, but I have a hard time getting excited about a company that has been a dreadful long-term investment, only promises 5% year-over-year revenue growth, and has to lean on cost-cutting moves to get to profitability. For that reason, my plan is to keep my capital far away from Accuray's stock.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.