Business in Brief / Wharton Properties Weighs Tel Aviv Bond Sale

Mellanox beats earnings forecast; Check Point profit up, share buyback boosted; Steinmetz drops plan to buy into JEC; and TASE ends month lower.

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Stock prices flash on an electronic screen displaying world clocks at the Tel Aviv Stock Exchange (TASE) in Tel Aviv, Israel, on Thursday, Dec. 11, 2014.
Stock prices flash on an electronic screen displaying world clocks at the Tel Aviv Stock Exchange on Thursday, December 11, 2014.Credit: Bloomberg

Wharton Properties weighs Tel Aviv bond sale

The New York property developer Jeffrey Sutton is weighing a bond offering by his Wharton Properties in Tel Aviv, TheMarker has learned. If it sells the bonds, Wharton, with a portfolio valued at $6 billion, would be the biggest of a wave of U.S. real estate companies that have raised debt in Tel Aviv in recent months. Two smaller real estate companies are considering selling bonds in Tel Aviv. Property Markets Group, which is controlled by Kevin Maloney, is seeking a rating ahead of a planned bond issue with Rosario Capital managing the offering. And Yehezkel Strulowitz’s CS Real Estate Group is planning a sale based on its 2014 result, with Poalim-IBI managing. All told seven U.S. property companies are trying to sell bonds in Tel Aviv, taking advantage of very low interest rates. To date, five U.S. property concerns have raised a total of 3.5 billion shekels ($890 million). (Eran Azran)

Mellanox shares jump on strong quarterly results

Mellanox, the maker of technology for connecting network servers, beat the market’s forecast for its fourth-quarter 2014 earnings. Mellanox reported that profit not counting one-time items more than doubled to $28 million, or 59 cents a share, up from $9.7 million, or 21 cents, a year earlier. Analysts had expected an average 44 cents a share on sales of $135.1 million. Mellanox pegged first-quarter 2015 revenue at $140 million to $145 million, also ahead of consensus estimates for $135.4 million. In response, Nomura analyst Sanjay Chaurasia on Thursday raised his target price on Mellanox’s New York-traded shares to $60 from $58. (TheMarker Staff)

Check Point earnings beat analysts’ expectations

Check Point Software, the Tel Aviv network-security provider, on Thursday reported quarterly profit above expectations and said it would expand its share buyback. Check Point earned $1.07 a share excluding one-time items in the fourth quarter, up from 98 cents a year earlier, as revenue grew 9% to $421 million. Check Point had been forecast to earn $1.05 a share on revenue of $416 million, according to analysts surveyed by Thomson Reuters I/B/E/S. The board authorized a 25% increase in quarterly repurchases of shares outstanding, to as much as $250 million, and it lifted the overall program by 50%, to an aggregate of $1.5 billion. Check Point’s Nasdaq-listed shares, which reached a one-year high of $81.57 last week, were up almost 2% at $78.59 early in the afternoon in New York on Thursday. (Reuters)

Steinmetz drops bid to buy into JEC after Leumi objects

Beny Steinmetz won’t take a stake in Jerusalem Economy, Eliezer Fishman’s property-development company, after Bank Leumi protested. Steinmetz was offering to buy some 500 million shekels ($127 million) of shares but on the condition that the bank take a haircut on the 1.7 billion shekels of loans the bank made to Fishman. That would have meant Leumi writing off hundreds of millions of shekels on the Fishman debt. And that’s because about 40% of JEC shares are serving as collateral for the Fishman loans. Fishman, who has been struggling with the drop in the ruble and its effect on his big Russian real-estate portfolio, is Leumi’s biggest problem borrower. Reports of the Fishman-Steimetz deal collapsing sent JEC shares tumbling nearly 11% over Tuesday and Wednesday. On Thursday, the stock edged up 0.2% to close at 13.67 shekels. (Michael Rochvarger)

TA-25 ends day, week and month lower

Tel Aviv shares ended lower for a third session on Thursday, leaving the TA-25 down for the week and month. The benchmark index fell 0.4% to 1,447.85 points, a drop of 1.2% for January and 0.5% for the week. The TA-100 declined nearly 0.6% to 1,269.71. Trading was a heavy 2.18 billion shekels ($555 million) due to the expiry of the January Maof (TA-25) contract. Teva Pharmaceutical, under the shadow of concern about generic competition for its Copaxone multiple-sclerosis treatment, dropped 3.4% to end at 223.9 shekels. TowerJazz led declines in tech shares, falling 4.9% to 59.9. Topping gainers on the TA-100, Silicom jumped 18.5% to 168.20 after it reported that fourth-quarter net income rose 26% from a year earlier to 94 cents a share. Pluristem closed 6.1% higher to finish at 14 shekels, extending a 21% jump the day before, after the investment-research house Acceleron gave its New York shares a $21 target price. In the foreign-currency market, the euro lost almost 1% against the shekel to a Bank of Israel rate of 4.403 shekels. The dollar weakened 0.5% to 3.926 shekels. (Dror Reich)