An interview with Commtouch (CTCH) was featured as part of our new subscription newsletter, Israel Opportunity Investor. You can find out more about the company and the opportunities we cover at www.israelnewsletter.com
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Can you tell us a bit about Commtouch (CTCH)?
Gideon Mantel, CEO: Your timing is fantastic, by the way. Small-cap Israeli stocks have been hammered over the past 9 months. With the shekel appreciation, funds in the states lost money just on 
the currency divergence. Commtouch (CTCH) has a unique piece of technology. We have the ability to look at a huge stream of data and monitor and recognize patterns. Essentially, we function in the cloud [Ed.: the cloud refers to computing resources being accessed which are typically owned and operated by a third-party provider on a consolidated basis]. Scalability, performance, cost and results can be very attractive in the cloud. Over the past 4 years, we’ve used our technology to address secure messaging problems: that is, we aim to stop spam and viruses propagated over email.
How do you distribute your anti-spam solution?
GM: We have traditionally worked solely via OEM agreements. Because we focus on the enterprise, it’s our opinion that it’s more important to sell software bundled together as all-in-one solutions, not best of breed. (Continue »)
What do you get when a leading revenue management firm teams up with leading telecom billing solutions
provider?
A pretty neat fraud detection and prevention solution with an expert delivery team.
Reporting in Globes this morning, ECtel (ECTX) announced a collaboration with Amdocs (DOX) in which ECtel will team up with Amdoc’s system integration services to market its FraudView product suite. The software allows advanced detection of fraudulent activity as part of customer acquisition, credit risk management, and new subscriber evaluation processes. (Continue »)
Written by: Israel Investor Newsletter | May 13, 2008
012.Smile (SMLC): “The firm noted that revenue decline reflects a significant year-over-year decline in revenues from hubbing services and a 14% year-over-year decline in the average shekel-dollar exchange rate.” (see article here). Earnings release here. See what IOI has written about SMLC and why some asset managers think it’s cheap.
Voltaire (VOLT): Stock up over 25% this week. Company reported earnings the market liked yesterday. Revenues are up, earnings are up, and margins up a lot. Earnings release here.
Answers.com (ANSW): Stock down big this week off of earnings expectations. They didn’t look too good. Earnings release here. Answers took a $2.0M charge on terminating the Dictionary.com acquisition. Traffic was down sequentially to Answers.com while WikiAnswers seems to be chugging along nicely.
Zoran (ZRAN): IOI Portfolio Member Zoran gets an upgrade from PiperJaffray. The banking firm “predicts Zoran’s growth will bottom out in the second quarter and then rebound as consumers transition to high-definition DVD players and sales of its chips and other products climb.” See our coverage of the firm here.
Ormat (ORA): Israeli geothermal player, Ormat, sells 3M shares this week in a block trade to Lehman Brothers.
NICE (NICE): Anti-rogue trader product unveiled by Israeli security play, NICE. NICE’s Actimize unit is a leader in employee fraud detection and trading surveillance systems at large global firms and is rumored to have detected the massive fraud at Societe Generale. See what we wrote about NICE recently. NICE reports on May 14th.
Aaron Katsman
www.IsraelNewsletter.com
Remember the 80’s Hall and Oates classic ‘Private Eyes’? Who can forget such powerful lyrics: ”Private eyes They’re watching you They see your every move Private eyes They’re watching you Private eyes They’re watching you watching you watching you watching you.”
Well flash forward 27 years. How right they were. If you happen to be a proprietary trader or stockbroker, and you are thinking about becoming a famous rogue trader, think again. While you may get famous and bring down a huge bank like Societe Generale, your chances of landing in prison just increased. Why? Because of Israeli ingenuity. Actimize, a NICE Systems (NICE) company has launched a surveillance product for rogue trading detection.
The company worked with financial institutions to develop a product that meets the needs of the firms.
“In response to regulatory pressure and rogue trading events in early 2008, large firms around the world are reviewing their systems and risk management processes,” said Axel Pierron, senior vice president at Celent. “Solutions, such as Actimize’s, that provide a centralized view of trading activities supervision as well as employee surveillance are clearly matching the current needs for ‘rogue trading’ prevention solutions in the financial industry.”
Long-term investors may want to take a long look at NICE. With a continued focus on tracking money flows, even if we see a slowdown in IT spending in the financial services industry, NICE may not see that slowdown. In many cases this is becoming required spending, and slowdown or not, NICE’s product suite will be in demand. Coupled with continued strong EPS growth, NICE, potentially, maybe an interesting long-term play.
Forget about any monkey-business, They’re watching you watching you watching you watching you ……..
Disclosure: Author’s fund has a position in NICE. He has no position in any other stock mentioned as of 5/12/08.
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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.
