Signup for our free newsletter:

The $17.8 Trillion Market from Silicon Wadi

Written By Brian Hicks

Posted June 22, 2007

According to, the tiny state of Israel has more engineers and scientists per capita than any other country in the world.

It also ranks third in entrepreneurship.

So it’s no wonder that when Sam Hopkins came back the other day from his two-week research trip from the Holy Land, the first words out of his mouth weren’t about the mayhem in the Gaza Strip. They were about the booming Israeli high-tech industry and the opportunity for foreign investors.

According to Sam’s latest field report:

More than 100 Israeli startups have ended up on major global stock exchanges in recent years, leading tech stock analysts to dub Israel the “Silicon Wadi.” Wadi is an Arabic word borrowed into Hebrew, and it means a river valley that flows in the wet season but is bone dry in the summer.

Were these writers just looking for a quick turn of phrase, or did they mean some meteorological metaphor? After all, through mergers and acquisitions, some 35% of Israel’s IPOs have been absorbed by other, much larger companies.

One of Sam’s core holdings is an American firm that recently acquired an Israeli high tech company which makes terminals that can read debit, credit and smart cards. Consumers can use these to pay for goods and services or access bank accounts. This technology is essential to today’s increasingly cashless economy.

Sales are booming. In 2005 the company did $485 million in sales.

Today? It’s running around $663 million.

And they just landed a massive contract with a Chinese Bank . . . a bank that has 36,000 branches and over $190 billion in savings deposits!

Sam recommended this stock to his readers in November of last year. And the stock is already up 26% since.

But Sam thinks it’s going a lot higher. You see, electronic payment providers are being acquired by much larger companies wanting a piece of this multi-billion-dollar pie.

Last month, Alliance Data Systems agreed to be acquired by private equity titans Blackstone Capital Partners. The Blackstone-Alliance deal marked the third time in two months that a private equity firm has taken a stake in the sector. In April, Kohlberg Kravis Roberts agreed to acquire First Data, and Warburg Pincus agreed to acquire a 25% stake in the Marshall & Isley spin-off Metavante.

Buy this stock before it goes up even more. Sam has prepared an exclusive research report on this booming sector, and gives the name of this stock that’s up 244% since its IPO in 2005.  Click here to receive Sam’s special research report .


Brian Hicks