With the summer Olympics set to start in a week, an Israeli start-up that monitors water quality just took gold. Blue I Technologies has been selected by Chinese officials to monitor water quality of the pools for the competition. Though they thought they were out of the running, the Chinese weren’t happy with their competitors results and turned to the Israeli start-up and awarded them the contract.

According to a report in Globes, Blue I CEO Tsur Ben-David said, “We thought it was over. We didn’t think that we’d find a place in the Olympics. The pools were under construction and a top German company had won the contract to supply the water quality monitoring systems for four variables, while a US company was supposed to monitor two other variables. But the Chinese were dissatisfied with the results and turned to us five months ago. This contact initiated a process that ended with our systems undergoing a two-month pilot at the Olympic facilities and we were selected to monitor all six variables.”

This has caused a ripple effect (nice pun) as the company has gained a lot of attention and even the Chinese Ministry of Health has contacted them in order to learn more about their water quality solutions.

While no Israeli swimmer or diver is expected to medal in the upcoming games, it’s good to know that Israeli ingenuity and know how will play an important part of the competition.

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NEW! Introducing Israel Opportunity Investor, our monthly subscription-only newsletter. Stay ahead of the game and make smart decisions in Israel stocks. Go here to learn more.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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Shares in the Israeli RRSat Global Communications (RRST) are having their best day in a long time, as the company surpassed earnings estimates and guided higher for the rest of the year. The company reported that gross margins increased to 32.4%, a 30% year-over-year revenue increase and a strong backlog of orders.

The company provides global, comprehensive, content management and distribution services to the rapidly expanding television and radio broadcasting industries, via  “RRsat Global Network,” composed of satellite and terrestrial fiber optic transmission capacity and the public Internet.

Commenting on the earnings, David Rivel, CEO said, “The second quarter of 2008 was another strong quarter, particularly in terms of revenues while improving our profitability, back to the ranges we expect. Furthermore, we continued to generate healthy cash flow, which will support our expansion strategy. Our backlog grew strongly, again to record levels offering us continued strong visibility for the coming years. In addition, we closed the acquisition of the Hawley teleport that will contribute to our growth in 2009 and beyond.”

While many Israeli hi-tech companies have struggled so far in ‘08, we have started to see some nice earnings reports, and along with RRSat, it appears that there is some hope for the second half of the year.

Disclosure: Author’s fund has a position in RRST, he has no position in any other stock mentioned as of 7/31/08.

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NEW! Introducing Israel Opportunity Investor, our monthly subscription-only newsletter. Stay ahead of the game and make smart decisions in Israel stocks. Go here to learn more.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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The Israeli company Energtek (EGTK.ob) has developed a new alternative technology allowing motorcycles to be powered with natural gas.

According to a report in the Jpost: “Energtek has developed a system to power two- and three- wheeled vehicles with natural gas. The motorcycles and scooters use gas canisters that can be replaced in less than a minute, without the need for special refueling stations, CEO Lev Zaidenberg said. The technology also makes it more cost efficient to tap so-called stranded gas in reservoirs that aren’t large enough to justify building a pipeline.”

The company plans to target Asia, where there are more than 250 million two- and three-wheeled vehicles. The company plans on doing a private placement shortly in order to fund the initiative, and they claim that they will be profitable in 2010.

It’s funny because Israel never had an auto or transportation industry, but because of the country’s global technological edge in alternative energies, an alternative transportation industry is starting to pop up. From natural gas powered motorcycles to electric cars, as in Project Better Place,  to GreenRoad Technologies, - Zack” Cleantech” Miller’s favorite-who employ a in-vehicle device that improves driver safety and betters fuel consumption for car fleets, maybe just maybe Israel will be the Detroit of the 21st century.

Disclosure: Author’s fund has no position in any stock mentioned as of 7/30/08.

Please see our Disclaimer HERE.

NEW! Introducing Israel Opportunity Investor, our monthly subscription-only newsletter. Stay ahead of the game and make smart decisions in Israel stocks. Go here to learn more.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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As we finally get to see some decent earnings coming out of Israeli companies that trade in the US, it seems that these companies have all read the same ” Prop up your stock” book. Can you say stock buyback? Companies like Commtouch (CTCH), Alvarion (ALVR), AudiCodes (AUDC) are among Israeli companies that posted good earnings, raised guidance and announced share buybacks.

I know that share buybacks are ‘tax efficient’ as well as they fatten EPS numbers, but how about doing something radical for investors?  Something like paying a dividend, or investing in growing the company. Doesn’t a stock buyback just mean that the company has nothing better to do with their money? Give some of your profits back to shareholders. Hey, there is an idea! For a great analysis of the pros and cons of buybacks, check out economist Stefan Karlsson’s blog.

All 3 aforementioned stocks have gotten nailed this year, so why not reward investors by paying a dividend. After all if we are only worried about being tax efficient, then just sell all your losing stock and take the tax loss. BTW nice article over at Bizzywomen.com, explaining tax losses.

After all I guess after the many Israeli companies that have provided lousy earnings results, we should just be happy that these companies beat estimates. That’s reward enough for investors.

Aaron Katsman, IsraelNewsletter.com

Disclosure: Author’s fund has a position in AUDC,ALVR. He has no position in any other stock mentioned as of 7/30/08.

Please see our Disclaimer HERE.

NEW! Introducing Israel Opportunity Investor, our monthly subscription-only newsletter. Stay ahead of the game and make smart decisions in Israel stocks. Go here to learn more.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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