Bank Hapoalim reiterated its Buy rating for Retalix (Nasdaq:RTLX), setting a $20 price target, 36% above market. Retalix provides software solutions for the retail market.

Analyst Moshe Moshkovitz notes that financial results for 2001, 64.4% revenue growth, and some $4 million net profit, were in keeping with projections.

The analyst believes that the company managed to meet the forecasts because it focuses on the traditional food sector in the retail market. This provides stability and allows it to grow despite the economic slowdown.

The analyst said that due to the global recession and sharp competition companies are buying more Retalix products, which assist them in attaining a competitive edge.

Moshkovitz estimates that Retalix could win projects for upgrading software products at the 17 leading retail chains in the Untied States, as these chains will be forced at some point to upgrade their systems. The analyst believes that Retalix's growing reputation among American retail chains increases the chances that it will get new contracts this year. Such deals will mainly affect 2003 revenue.

The analyst estimates that this year 85% to 90% of revenue growth will be generated by existing business, which gives Retalix relatively high visibility and explains why in its guidance Retalix could allow itself to predict 20% revenue growth in 2002. Moshkovitz regards the guidance as conservative, and expects sales will grow by 25% this year.