Here is the email that was sent out by Jeff Howard of Global Resources, which is probably the most knowledgable broker for the junior exploration companies:
Subject:
Market Commentary - Francisco Gold
Date:
Fri, 26 Jan 2001 15:34:33 -0800
From:
Jeff Howard <jeffhoward@gril.net>
To:
Mary Goddard <mg@gril.net>
CC:
Legal Outgoing <LegalOutgoing@gril.net>
Market Commentary
January 26, 2001
Francisco Gold Corp
(FGX.V:CAN$5.00)
This commentary is being directed to clients of Jeff Howard who own
Francisco Gold Corp.
Today we received more good news from what admittedly is my favorite
junior
gold company. This morning, Francisco released assays from 10 additional
holes drilled on its Marlin property located in northwestern Guatemala.
As
reported last October, the initial 14 holes identified a high-grade zone
at
the surface of the ridge and a second, lower grade zone below it.
Beginning
with hole #1, that drilling progressed in an easterly direction along
the
top of the ridge. The most recent drilling was conducted to the west,
southwest, and south of hole #1. Each of the ten new holes encountered
the
high-grade mineralized zone previously seen in the first round of
drilling.
On average, grades and intercepts were much better than those of the
first
14 holes. We need to do further technical evaluation, but it appears to
us
that drilling to date at Marlin has defined a resource of about 750,000
ounces of gold equivalent. Furthermore, this resource on average is of
high
grade and resides right at the surface of the ridge, meaning that mining
costs ought to be extremely low due to minimal stripping and easy
access. In
addition, the mineralized zone remains open in three directions and
other
surface showings in the immediate vicinity suggest that there may be
separate but related deposits. The next round of drilling, which should
commence in late February, is designed to expand the Main Zone as well
as
test new showings to the south.
Within 45 minutes of the open this morning, Francisco's stock rose from
CAN$4.50 to CAN$5.50 per share. Then, at least one institutional
shareholder
commenced selling through RBC Dominion Securities in Canada and the
stock
declined to CAN$5.00/share, where it ultimately closed. Francisco has
CAN$34
million in cash (CAN$2.00/share), a 1.5 million ounce gold deposit in
Mexico
that I think is worth about CAN$6.00/share, and this new deposit in
Guatemala that I believe is worth another CAN$5.00/share and could get
bigger. That's CAN$13.00/share of value and this institution is
unloading at
CAN$5.00/share. When I see behavior like this, it scares me to think how
many people in North America invest their money through mutual funds and
pension funds. Selling $13 companies for $5 is not what I consider
professional management. It's frustrating for clients who own Francisco
to
see the company perform well and the stock price to languish. However,
in
the long run, money is made in the stock market by smart people taking
advantage of the "cerebrally impaired". Be smart; stick with Francisco.
In
my opinion, it's one of the cheapest gold stocks in the market today.
Jeff Howard
The information set forth herein was obtained from sources which we
believe
reliable, but we cannot attest to its accuracy. From time to time, this
company, it's officers or employee's may have a position in the
securities
mentioned. Recommendations and market commentary are made as a general
review; any specific action in regards to individual purchase, sale or
investment is a matter of individual suitability and should be a matter
of
discussion between client and broker before each and every action is
taken.
--
James G. Boyd IV
Associate Professor
Department of Aerospace Engineering
3141 TAMU
Texas A&M University
College Station, TX 77843-3141
phone: (979) 458-0419
fax: (979) 845-6051
jboyd@aero.tamu.edu
aeromaster.tamu.edu |
