Investors are screaming their heads off at Shemen Oil Co. and its CEO, former IDF Chief of Staff Gabi Ashkenazi, after the company announced Monday that its Yam 3 oil well, off the Ashdod coast, is dry, despite indications a month ago it would reap a bonanza.
A final report will not be known until the equipment is taken out of the bore hole, leaving a “small chance that there was a breakdown in the production tests in the upper sections of the borehole,” Shemen stated.
The company said in September that there were signs of high quality oil in the well, into which was poured $175 million of investors’ money.
The company’s stock plunged 90 percent on Monday, prompting several investors to demand a Tel Aviv Stock Exchange investigation into the possibility that the announcement in September was made in order to allow insiders to sell their holdings at a profit, at the expense of an unknowing public.
In any case, Ashkenazi is not a big loser. He received salary of more than $1.5 million the past two years as Shemen CEO, not including high-class travel and four-star hotels, all at the expense of the company.
Israel’s giant generic Teva Pharmaceuticals firm will fire by the end of next year 5,000 employees around the world, including hundreds in Israel, as one of the “steps to accelerate the reduction of costs and to optimize its structure.”
Most of the layoffs will be outside Israel, said Teva CEO Jeremy Levin, who moved to Israel form the United States last year to head the company.
The layoffs are expected to save the company $1.5 to $2 billion by the end of 2017, and part of the savings will be re-invested in the development of generic and specialty drugs.
Levin maintained that the company is not suffering from financial problems. In New York, the company’s shares jumped 2 percent on news of the cutback in the workforce.
Teva’s stock was the darling of investors until five years ago, when the announcement of competitors’ generic drugs to replace Teva’s patented Copaxone drug, which treats multiple sclerosis, drove the stock down by nearly 50 percent.
With SodaStream, we could have saved 500 million bottles on Game Day alone. If you love the bubbles set them free.”
PepsiCo is negotiating with Israeli-based SodaStream to buy out the firm for $2 billion, according to the Israeli Calcalist business newspaper. SodaStream’s shares in Germany shot up nearly 20 percent after the report.
SodaStream, listed on NASDAQ, manufactures machines that make carbonated drinks from tap water and also produces flavors, carbon dioxide refills and re-usable bottles.
Officials at the two companies refused to comment on the report or were not available.
SodaStream has become a big hit in the United States, where the company “stole the show” with its commercials during the Super Bowl this year, drawing bitter complaints from carbonated beverage companies, which applied pressure to CBS for SodaStream to tone down its message that buying carbonated beverages in plastic bottles is bad for the environment. Pepsi and Coke also did not like the idea of SodaStream making fun of their companies, and the original version of the commercial was canned but can be seen below
A buyout by PepsiCo, or possibly by Coca Cola if SodaStream wants to try for a larger purchase, could place the company’s facility in Maaleh Adumim, east of Jerusalem, in jeopardy.
Soda Stream is a favorite target of the Boycott Israel movement because of the plant’s location beyond the old borders of Israel. The rub, as Lori Lowenthal Marcus explained in an article Tuesday night, is that SodaStream’s American-born CEO Daniel Birnbaum promotes hiring and treating Palestinian Authority Arabs just like Jews.
Both Arab and Jews share the company dining hall in Maaleh Adumim, and there are facilities for both Muslim ands Jews to pray.
The Maaleh Adumim factory employs approximately 900 Arabs from Judea and Samaria. “Everyone works together – Palestinians, Russians, Jews,” a Palestinian employee named Rasim at the Maaleh Adumim site previously has been quoted as saying. “Everything is OK. I always work with Jews. Everyone works together, so of course we’re friends.”
The report of a possible buyout sent the shekel-dollar rate down approximately half a percentage point, to below 3.65 shekels to the dollar, because of the possible injection of $2 billion worth of shekels.
The Israeli-based Wix website developer company has filed for a $75 million initial public offering (IPO) to raise the company’s value to $400 million.
Last week, the Israeli-based Kamada medical treatments company completed an IPO prior its stock trading on NASDAQ last week. Software developer Babylon also has filed for IP, and Caesarstone Sdot Yam Ltd., a maker of quartz-based countertops raised slightly more than $84 million in its IPO a year ago.
Wix, founded in 2006 by CEO Avishai Abrahami, his brother Nadav and Giora Kaplan, has developed an online platform for people to quickly and easily create their own websites.
Wix’s success has resulted in one million new users each month. Altogether, 28 million people have used its services and created 26 million websites. Wix employs approximately 400 people, most in Tel Aviv.
Wix’s business model is based on payments from users for its various premium services, such as larger storage space or options to add sale elements on websites. Users can choose among hundreds of website templates, and choose the colors, size, and other features as they see fit.
Business Insider earlier this year ranked Wix 65th in its Digital 100 list of the world’s 100 most valuable private tech companies, alongside companies such as Twitter and Dropbox.
One of the reasons why many investors fail in their investments is because they are driven by their emotions. This problem is studied by academics who specialize in an area known as behavioral finance.
People make decisions for all sorts of reasons, but when you make an investment decision based on emotion, not fact, you stand to lose your head, heart, and pocketbook.
For example, sometimes investors hear some positive news about a certain stock and they rush to buy it simply because they feel good about it. They haven’t necessarily researched its individual merits, or checked it against their financial plan to see if it fits with their overall investment goals. They just make a sudden investment decision.
Have you ever done that?
Many investors are driven by fear or excitement, and in both cases their surging adrenaline may help them in a “fight or flight” situation, but not with their investment portfolio.
If an investor is too fearful, he could end up either selling a stock needlessly or not developing his investment potential enough. But sometimes investors don’t have enough fear and they become the victims of Ponzi schemes and other scams.
I recently spoke with Professor Meir Statman, author of What Investors Really Want, on the Goldstein on Gelt show, and I asked him why he thought people let their emotions get the better of them. He replied, “People follow their intuition, and their intuition says that they can tell the difference between honest people and dishonest ones. Dishonest people take advantage of precisely that.” (Click here to hear more of what Professor Statman has to say.)
In the ideal world, investors have the time and resources to take a step back from their emotions and properly research financial moves. But in the real world, who has the time, financial background, or desire to educate themselves properly before making rational investment decisions?
What’s the solution for avoiding the pitfalls of emotional investing?
Find an effective and reliable financial planner. A financial planner has the knowledge and background necessary for researching and assessing various investments and finding out which ones are the most appropriate for you and your financial goals. For this reason, it’s worthwhile taking the time and calling your financial planner today.
Having an objective certified professional oversee your investments is the best way to prevent yourself from falling into the trap of emotional investing.