The entire interview with Chuck Goldblum of Hurley Capital is part of our new subscription newsletter, Israel Opportunity Investor. You can find out more about the product and the opportunities we cover at www.israelnewsletter.com

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Hi, Chuck. Can you tell us a bit about yourself and your firm, Emancipation Capital?
Charles Goldblum: Emancipation Capital is a deep-value hedge fund with a focus on investing in technology companies. We’re primarily involved in software names. I was previously a sell-side analyst in the supply-chain sector. In addition to consulting for Emancipation, I run my own asset management firm.

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Aaron Katsman
www.IsraelNewsletter.com

I would be remiss if I neglect to mention that tonight is my wife’s birthday. This post is serving me as a reminder that I still need to buy her a gift. Maybe I will get her a subscription the the IOI Premium Newsletter! With gold prices surging, I can’t afford to by her actual jewelry, but I can afford  to buy some shares in these 2 little-known Israeli stocks, and they are sure to be DIAMONDS in the rough.

Elbit Medical Imaging(EMITF) stock has dropped nearly 20% in the last few weeks. The real estate and bio-tech company was a big winner for investors in ‘07 and even with a slow start to ‘08, I look at ElbitMedical as a star performer this year as well. They are opening a mall in Poland( maybe I can get some cheap jewelry there) which is a continuation of their plans to continue building out the real estate holdings in Eastern European along with some new projects in India. As I have mentioned before, the real story with Elbit Medical is their very large stake in two of the most exciting private (though an IPO is definitely in the cards) companies Israel has to offer. Insightec ltd., develops a product that combines MRI technology with focused ultrasound in order to treat serious diseases such as bone, liver and brain tumors, without the invasive procedures that are currently used.  The other private company is Gamida Cell. Gamida Cell is developing, along with the aforementioned Teva,  a line of cell therapy products for the treatment of such diseases as leukemia and lymphoma. 

Jacada(JCDA) a leading provider of unified desktop and process optimization solutions for customer service operations, has been signing deals right and left and a few weeks ago announced that they were selling their Application Modernization Business to Software AGfor $26 million. They are doing this to solely focus on high growth business, to position Jacada as a pureplay in the call center solutions business. The firm provides a single, unified workspace for customer service organizations managing lots of legacy and disparate software systems. My buddy Zack”I love the Internet” Miller had a great analysisof this deal. I really think Jacada is poised to fly, and in fact with all the current selling on Wall Street, Jacada stock has actually been inching up.

Happy birthday!

Disclosure: Author’s fund holds a position in EMITF and JCDA. He has no position in any other stock mentioned as of 1/9/08.

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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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Jacada Ltd. (Nasdaq: JCDA), a leading provider of unified desktop and process optimization solutions for customer service operations, announced today that they’ve sold their Application Modernization Business to Software AG for $26 million. Effective date of the transaction is January 1, 2008.

This deal seems to be about focus — about positioning Jacada as a pureplay in the call center solutions business. The firm provides a single, unified workspace for customer service organizations managing lots of legacy and disparate software systems.

Jacada President (and new CEO, actually), Paul O’Callaghan, said of the deal, “During the past 3 years, our call center solutions business has grown at a compounded annual growth rate of 61% and represents 95% of our $12.9 million backlog as of September 30, 2007. We expect that the growth we have seen in this business will continue at a similar pace throughout 2008.”

Sounds pretty good. We’ve written about Jacada positively before and like the direction the company is taking. Along with the deal, we’ve seen Paul emerge as the new CEO with the founder and former CEO, Gideon Hollander, sliding into the Chairman seat. This is a company maturing and taking the right, and albeit tough, steps of the founder stepping aside.

O’Callaghan joined Jacada as President in May 2006, after successfully holding senior management roles in companies including Optio Software, Cisco Systems, IMNET Systems, XACCT Technologies, Idapta and Network Systems Corporation.

His experience in sale-oriented tech firms has allowed the company to grow its pipeline of new deals and land material type deals like recently announced deals with Central Hudson Gas & Electric, a regulated gas and electricity provider serving approximately 367,000 customers in eight counties of New York State’s Mid-Hudson River Valley.

Keep in mind the company has a market cap under $80 million and a cash position of $35 million. Add another infusion of cash to a company that had guided for 2007 revenue growth of 23 - 27% and get the firm completely focused on the call center business growing at a CAGR of 60% + and you have a nice little Israeli microcap.

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.

Author does not hold a position in JCDA.

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Zack Miller
IsraelNewsletter.com

Jacada (Nasdaq: JCDA), the Israeli software provider for unified customer service, has been murmuring about a material deal back in early August. Israel Opportunity Investor’s Aaron Katsman recently covered the announcement of the deal with Central Hudson Gas & Electric. Well, there’s another material announcement. This time it’s with O2 UK, the leading provider of mobile services to consumers and businesses in the United Kingdom.

Elbit Systems (Nasdaq: ESLT) out with strong earnings Wednesday with a posted 41 percent rise in third-quarter net profit on higher revenues and forecast a better performance in 2008. We chose Elbit as one of Israel Opportunity Investor’s “7 Touchdown Stocks” recently.

Gilat Satellite (Nasdaq: GILT) reported earnings for the 3rd quarter that more than doubled as the company increased revenue and held back costs. We wrote recently about why Gilat might be an interesting play right here.

NICE Systems (Nasdaq: NICE) announced that it has expanded its relationship with DirectTV (NYSE: DTV).

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