Given Imaging Keeps On Giving

I was recently on vacation, spending time both in Seattle and in New York, and I was asked to speak a bit on both the Israeli economy as well as interesting Israeli companies. Other than Teva Pharmaceuticals (TEVA), the company that is most well know is Given Imaging (GIVN). Everyone seemed to be aware of their “cool” PillCam technology. For those who don’t know, GIVN has revolutionized the gastrointestinal diagnosis industry with the PillCam video capsule, a disposable, miniature video camera contained in a capsule, which is ingested by the patient and allows for the non-invasive visualization of the GI tract. They have become the symbol of Israeli ingenuity.

For investors though, until recently, the stock was in a deep freeze. Though the company had this innovative technology, they had problems penetrating the market, and they disappointed investors with slower than expected growth. Over the last few quarters, however, the company has started firing on all cylinders, and the stock has reacted accordingly. Noted Israeli investor Shlomo Greenberg had an interesting take on the company’s newfound success in a recent Seeking Alpha article. He spoke about the appointment of Israel Makov, former President and CEO of TEVA, as Chairman and the impressive Board of Directors that has been compiled.

While this certainly plays a part in the company’s recent stock price surge, I think it’s actually executing the business plan that is the main driver. Recent news of Japan's Ministry of Health, Labor and Wealth approving PillCam SB Capsule and equipment for sale and marketing, signing a global strategic agreement with Fujinon Corporation to collaborate on research and development, sourcing and non-exclusive distribution activities and a strong 23% increase in North American PillCam sales, and raising of revenue targets for the rest of ’07, are the main contributors.

Ultimately it comes down to execution, not hype, to excite investors. We have seen too many overly-hyped Israeli companies falter. It’s refreshing to find innovative companies that are also able to execute on the business side.

GIVN 1-yr chart

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