I think a large part of the price decline by MAGS is the fact that some of the other 9/11 story-stocks have fallen apart - INVN in particular, and 'investors' were spooked by this and the fact that MAGS did not 'blow away' their quarter. I say 'investors' because many of the poeple that bought stocks like INVN and MAGS post-9/11 did not do any research, they bought what the people on CNBC put on T.V. and told them to buy. MAGS will reward the investor who has done some research and undersrtands the upside to MAGS will not really come until 2003. Until then we own a quality small-cap trading at 20X this years earnings...
I agree 100% with your assessment and am thinking of adding to my Magal holdings today. Anyone who has been following MAGS for awhile will remember that the CEO has cautioned all along not to expect a jump in earnings until the second half of 2002 at the earliest.
He said this is because Magal works alot with government contracts, and governments, of any kind are notoriously slow in making decisions.
(I know this is true because I am a government contracter and the process of getting a contract is painfully slow... The government has to issue an RFP, the potential contracters have to answer the RFP, and then wait while a committee decides who to award contracts to. This can take months.)
Since Israel is a democracy, I bet that even for Magal to get contracts within Israel, the same process is followed.
I agree with your post that patient investors will be rewarded.
BTW, if any of you are afraid to invest in Magal, or any other Israeli company because of the current "situation" - think about this - If anything (GOD-FORBID) should happen to Israel, we will probably witness the collapse of the Nasdaq, as next to the United States, (I believe), "little" Israel has the most Nasdaq-listed stocks of any country in the entire world!