Israeli fence-tech company doing great after Trump win

Magal Security Systems’s shares on the rise since election.

November 19, 2016 20:12
3 minute read.

Trump calls for "extreme vetting" for immigrants, calls to build a wall between Mexico

Trump calls for "extreme vetting" for immigrants, calls to build a wall between Mexico

As the global financial market felt the results of the US elections on November 9, many stocks in many sectors plummeted while others, mainly in the fossil fuel and security and defense markets, experienced a substantial boost.

One such Israeli company, Magal Security Systems, experienced a 6% rise overnight on NASDAQ, eventually capping at 19%.

“Trump’s victory brings great opportunities for anyone in the security and defense market,” Magal CEO Saar Koursh told The Jerusalem Post in an interview. “I’m not taking a political position here, I’m merely noting as a CEO of a security company: When you have an administration that is more security- oriented and will allocate budgets to that end, many in the market including us will enjoy that.”

Based in Yehud, Magal was established as a department of the state-owned Israel Aerospace Industries (then known as Israel Aircraft Industries) in 1969, as a branch that deals in border and perimeter defenses.

It went private in 1984 with 26% of the shares still held by IAI. Magal made its IPO on NASDAQ in 1993 under the symbol MAGS. Since the US elections the Magal stock has been going through a steady upward trend, with another substantial boost Monday through Friday.

The company has helped construct security barriers along the Egyptian and Jordanian borders, and has contracts to do the same in Kenya, Somalia and other countries.

Locally, Magal is better known as the Israeli company that helped develop the security fence around the Gaza Strip.

Koursh credits the steady rise in the stock since Trump’s victory to his company’s good PR, saying that Magal has become a household name in the field of perimeter protection and smart fences.

“Magal did the most border defense projects in history, we worked on over a thousand kilometers of border so far. In Israel we are the main service provider for the Defense Ministry, with 85% of our borders being done by Magal over the past 40 years,” Koursh told the Post.

“Now that Trump is in power there’s a lot of talk of finding solutions for the US borders, and we are a major player in that field. Even before the elections, most of our business comes from the US, in fact more than half of our company is located in North America and we are well known by American institutions and contractors,” he explained.

But Koursh wanted to two things clear, that Magal is not a fence company, and that the firm does more to protect the perimeters of strategic assets than it does borders. “We are not actually a fence company, we are a tech company. We don’t make fences, we make fences smart with tech solutions.

Our advantage is that as the leading company in this field we have the biggest portfolio of solutions, he told the Post.

According to Koursh, there are seven or eight technologies in the world that apply to perimeter security, and usually the other companies in the field offer one or two of these to their customers. “Over the years Magal has incorporated all related technological solutions, either through research and development or through acquisition,” These technologies include motion and shock sensors, temperature change sensors, sound detection and video motion detection tech. Magal has furnished more than 40,000 kilometers of perimeter around the world with its tech.

“Compared to the entire security tech market, perimeter security is a small sector, but within that sector we represent 10% of the global market. And considering the needs that Mr. Trump described in his campaign, I believe that Magal has the best and most appropriate solutions,” Koursh said.

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