Business in Brief: Sapiens Cuts Outlook After Project Is Halted

Check Point beats expectations on profit; Mellanox shares plunge on poor earnings; Tel Aviv shares end lower on Syria tensions

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.
Bloomberg

Sapiens cuts outlook after project is halted

Shares of Sapiens, a maker of software for the insurance and finance sectors, plunged Thursday after the company disclosed that a project with a major customer was halted over a business dispute and that its results for this year would be affected. The company said the customer, which it did not identify, accused Sapiens of a major breach of contract, an allegation Spines denies. “We are disappointed that this project has been halted, and we are working to resolve this matter with the customer,” said CEO Roni Al-Dor. He said the dispute wouldn’t affect Sapiens’ other business, but the company revised lower its guidance for its 2017 revenues to between $265 million and $275 million on a non-GAAP basis, compared to the $275 million analysts had been forecasting. Operating profit margins will be 3% to 4% in the first half, rising to 13.5% to 14.5% in the second. Sapiens’ shares ended down 8.5% at 44.95 shekels ($12.36). (Omri Zerachovitz)

Check Point beats expectations on profit

Network security provider Check Point Software Technologies reported quarterly net profit that slightly beat expectations on strong growth in demand for mobile security and threat-prevention products. Check Point earned $202 million, or $1.20 a share excluding one-time items in the first quarter, up from $187 million, or $1.06, a year earlier. Revenue grew 8% to $435 million, the Tel Aviv-based company said on Thursday. It had been forecast to earn $1.19 a share on revenue of $433 million, according to Thomson Reuters I/B/E/S. “Our focus on cloud, mobility and threat prevention is paying off and has contributed nicely to results this quarter,” said CEO Gil Shwed.  Bloomberg News said Check Point is moving into the automotive cybersecurity market and will lead a working group including Israel’s Argus Cyber Security and Valens to set standards. Shares of Check Point were up 0.7% at $104.96 midday local time in New York. (Reuters)

Mellanox shares plunge on poor earnings

Mellanox shares fell after the chip maker reported late on Wednesday disappointing earnings. The company said per-share earnings adjusted for one-time gains and costs came to 29 cents per share, 20 cents less than the average estimate of analysts surveyed by Zacks Investment Research was for earnings of 49 cents per share. The company posted revenue of $188.7 million, which was also well under the $205.1 million analysts surveyed by Zacks expected. For the current quarter, Mellanox said it expected revenue in the range of $205 million to $215 million, less than Zacks analysts forecast for $224.2 million. “Our first-quarter InfiniBand revenues were down year-over-year, impacted by delays in the general availability of next generation x86 CPUs, seasonal trends in high-performance computing, and technology transitions occurring across several end users and OEM customers,” said CEO said Eyal Waldman. Mellanox shares were down 10.2% at $45.70 midday local time in New York. (TheMarker)

Tel Aviv shares end lower on Syria tensions

Tel Aviv shares ended moderately lower on Thursday amid concerns over rising tensions with Syria after an alleged Israeli missile attack. The blue-chip TA-35 index lost 0.4% to end at 1,405.45 points, while the TA-125 fell 0.3% to 1,271.40, on turnover of 1.86 billion shekels ($510 million). Among losers, Bank Leumi shed 1.3% to 16.95 and was the most active share of the day. Bank Hapoalim fell 1.2% to 22.61. But insurance companies extended their gains another day, and Israel Chemicals climbed 3% to end at 15.65.  Super-Sol rose 1.1% to 17.85 a day after it sold 214 million shekels in new stock. Bezeq finished 1.1% lower after Chief Financial Officer Allon Raveh said he was stepping down. Teva Pharmaceuticals rose 0.7% to 114.50. The drug maker said it had announced the launch of its generic version Vytorin tablets, whose branded version has annual sales of about $678 million in the United States. (Shelly Appelberg)