Babylon Ltd. rose to the highest in almost two weeks as the translation software maker is set to start a roadshow for a U.S. share sale in early 2013 and after a drop to the lowest level in eight months lured some investors.
Shares of Babylon, based in the town of Or Yehuda, Israel, added 3.9 percent to 24 shekels, the highest level since Dec. 13, at the close in Tel Aviv. The shares have gained 14 percent in the last two days. The rally comes after the stock fell to 21.12 shekels on Dec. 24, the lowest level since April, on concern revenue from its partnership with Google Inc. may erode and on worries a bit to list on the Nasdaq stock market may be halted.
“With the Nasdaq sale still planned for early next year and after such a dramatic stock drop, some investors are picking up the shares,” Eran Jacoby, head of research at DS Securities & Investments in Tel Aviv, said by phone today. “The Israeli media has been hyper-speculative about changes on the Google partnership and there’s been negative news flow about the IPO. The best thing the company can do right now is expose itself to U.S. investors.”
The share’s relative strength index rose to 45 today from 29 on Dec. 24. The index measures the momentum of a stock’s movements and a reading below 30 indicates it may soon rise.
Babylon’s stock has slumped 20 percent since the company said Nov. 25 it planned to start a roadshow for the potential U.S. initial public offering in early 2013, later than some investors anticipated. The company said earlier in the month it will seek to raise $115 million in an offering and that it wants to list the shares on the Nasdaq stock exchange.