Yesterday, heavy profit taking hit a number of Israeli shares that have risen steeply recently. I suggest that you follow them closely, because if yesterday’s negative trend continues, it will create new buying opportunities. This is particularly true of shares like Alvarion (Nasdaq: ALVR; TASE: ALVR), AudioCodes (Nasdaq: AUDC; TASE:AUDC), M-Systems Flash Disk Pioneers (Nasdaq: FLSH), and, of course, Check Point (Nasdaq: CHKP), Mercury Interactive Corporation (Nasdaq: MERQ), Comverse Technology (Nasdaq: CMVT), and several others. Although the latters’ prices are still very high for my taste (except for Check Point, which is still traded at an economically justifiable price), if the downtrend persists, it could bring these shares to a level with some relation to their economic value, making them a possible worthwhile buy.
If the market begins a correction, shares like Keryx Biopharmaceuticals (Nasdaq: KERX;; LSE: KRX), Compugen (Nasdaq: CGEN; TASE: CGEN), Lumenis (Nasdaq: LUMEE), and Gilat Satellite Networks (Nasdaq: GILTF) are liable to fall as fast as they have risen recently. The TAT Technologies (Nasdaq: TATTF) share is already priced at very economic values. Since the market has until now usually risen a lot and fallen very little, I think the best thing to do right now is to wait. On the one hand, there is no justification for the US Federal Reserve Board’s panic yesterday, but a nice correction would be justified, and it’s best to sit and watch at such times.
Why did NDS Group plc (Nasdaq: NNDS) buck the trend yesterday? First of all, a lot of shares rose yesterday, but NDS also had its own reason, which I explained a long time ago. News Corp’s success in telecommunications has had a direct effect on NDS. Mighty Cablevision Systems (NYSE: CVC) signed an agreement with NDS, under which British-Israeli company NDS will supply the software for Cablevision’s digital television set-top boxes. In my opinion, this constitutes an indirect triumph over Scientific Atlanta (NYSE: SFA), NDS’s chief rival. In the first partnership between NDS and Motorola (NYSE: MOT), the Scientific Atlanta’s main competition in digital TV set-top boxes, Motorola will manufacture the hardware. An agreement like this should have had, and did have, an effect on the NDS share, even on a day like yesterday.
Terayon (Nasdaq: TERN) took a dive yesterday. In my opinion, however, the reason was not the company’s fourth quarter results, which were excellent. The previous steep rise in the share and concern stemming from bad experiences with the share on the part of investors (unjustified, in my opinion) were the causes. Harmonic (Nasdaq:HLIT ) continued its climb yesterday, jumping 7.7% to $10.80, a new high for the year.
Published by Globes [online] - www.globes.co.il - on January 29, 2004