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Opportunities Ahead

Last updated on 2016-03-12

The latest developments in Egypt are starting to create new opportunities that lately have been hard to find in the Israeli market. Updating on my last post, DLKR.C3 is now selling at 21.3% yield and DLKR.B4 at 23.27%.

The crisis in Egypt can have two outcomes (this is very simplistic, but I think that underneath all, life is simple): the new Egyptian government can be anti-Israel or not anti-Israel. If it is not anti-Israel, we will have some more quiet time and the markets will return to normal. Otherwise, if the government is anti-Israel, things could get serious around here but as Peter Lynch said in “Beating the Street” (or what I remember from what he said): “if Armageddon is coming, who cares how much money you have since it won’t be worth much after it. But if you buy cheap and Armageddon doesn’t come, you will make very good money”. So even if our neighbors become our worse enemies, Armageddon won’t come.

There are also some other securities that I have put an eye on. For example Discount Investment (DISI) fell 5.49% today. I have not finished yet a full analysis of the company but I like the management, the company has strong holdings and has a dividend yield above 15% (!). Some other companies caught my eye, like Formula Systems (FORT), Bezeq (BEZEQ) which fell under the 1000 line, and also Gav Yam (BYSD) is starting to become interesting again. Hell, probably a lot more companies in the Tel Div 20 index are finally becoming buyable again. I love dividend companies, but lately their price (and that of all other stock) is not worth the risk. Maybe this is changing today.

Tomorrow will be a new day… and we will know if the fall will continue and with it the opportunities.

Disclaimer: Long on Bezeq, Gav Yam, Discount Investment and DLKR.C3 (obviously).

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