MagicJack Gains on New Customers as Teva Falls: Israel Overnight
Stock Chart for Teva Pharmaceutical Industries Ltd (TEVA)
MagicJack VocalTec Ltd. (CALL), the Israeli company whose founders invented the technology used to make telephone calls over the Internet, surged the most in a year after raising its sales outlook and ending plans to issue stock.
The shares rose 7.4 percent in the U.S. yesterday, bringing the two-day gain to 27 percent, the most since September 2010. The Bloomberg Israel-US 25 Index of the largest New York-listed Israeli companies fell for the first day in four. Teva Pharmaceutical Industries Ltd. (TEVA) led declines, swelling its discount to the Tel Aviv shares to the most among companies listed in both markets. Teva lost 2.3 percent at the close in Tel Aviv, as the benchmark index gained 0.8 percent.
MagicJack is seeking to tap the growing market for Web- based calls from mobile handsets, competing with Skype Technologies SA, a unit of Microsoft Corp. (MSFT), and Vonage Holdings Corp. (VG), the biggest U.S. provider of telephone service over the Internet. The Israeli company added 365,000 customers in the 30 days through mid-December, which Chief Executive Officer Daniel Borislow said was similar to the number of new clients the company took on during all of the third quarter.
The stock rose after “they canceled the share sale and after they sold the new devices,” said Aaron Blazar, the vice president of Boston-based telecom research company Atlantic-ACM. “Similar competitors struggle to add 10,000 new customers during a quarter.”
The Standard & Poor’s 500 Index (SPX) fell 1.2 percent and the Nasdaq Composite Index (CCMP) retreated 1.3 percent yesterday after European Central Bank President Mario Draghi said “substantial” risks to the economy remain.
The Bloomberg Israel-US 25 Index declined 2 percent to 85.43.
Teva retreated today to 159 shekels, or the equivalent of $42.06. The U.S. shares fell for the first time in seven trading sessions, retreating 2.4 percent to $41.71. The Israeli shares closed yesterday at the equivalent of $42.83. The $1.12 discount was the biggest among the Israeli companies traded both in New York and Tel Aviv.
The world’s largest maker of generic drugs will hold a conference call with analysts tomorrow to update its 2012 guidance.
Israel, whose population of 7.7 million is similar in size to that of Switzerland’s, has about 60 companies traded on the Nasdaq stock market, the most of any country outside North America after China. It’s also home to the largest number of startup companies per capita in the world.
The shekel gained 0.6 percent to 3.7787 a dollar by 4:30 p.m. in Tel Aviv. The currency has lost 6.7 percent versus the dollar this year, heading for its worst annual performance since 2002.
MagicJack, based in Netanya, Israel, raised its fourth- quarter sales forecast to $60 million from $55 million following the addition of new customers, according to a statement on Dec. 16. In the same statement, the company said it canceled plans to sell more shares. The company reported sales of $28.51 million in the fourth-quarter of 2010.
The stock had dropped 18 percent in the five days after MagicJack said Dec. 9 it would issue new shares.
MagicJack sells a device that plugs into a personal computer and a telephone handset, allowing customers to make local and long-distance telephone calls for a fee of $19.95 to $29.95 a year. A new device, which costs $69.95, can be used to make telephone calls without being plugged into a computer.
“We’re anticipating very good sales with the new product,” Borislow said in an interview from Palm Beach, Florida. “People have a choice, they can use it with or without a computer. We’re the only ones to have this.”
Radware Ltd. (RDWR), which makes technology to help networks run more efficiently, advanced for a third day, increasing 0.8 percent to $29.96, the highest level since Aug. 4.
Oppenheimer & Co. raised its estimate for Radware’s 2012 sales to $186.1 million from $182.6 million, according to an e- mailed report yesterday. “Radware is seeing strong globally balanced demand in the quarter with no signs of weakness out of Europe,” Ittai Kidron, an analyst at Oppenheimer in New York, wrote in the report.
EZchip Semiconductor Ltd. (EZCH), the Israeli maker of network processors, rose 0.3 percent to 111.30 shekels, or the equivalent of $29.45. The U.S. shares fell 0.4 percent yesterday to $29.15.
The Israeli maker of network processors is the “best idea” in the semiconductor industry for 2012, Jeff Schreiner, an analyst at Capstone Investments in San Diego, California, wrote in an e-mailed report yesterday.
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