Wade:
I'm going to wait a few days to see if Nesbitt is finished selling. Even
though they recommend it as a buy with a target in the $2.80
range in twelve months (a virtual double from here), because they
lowered their estimates from the $4.50 range, all the conservative
brokers over there are selling. Isn't a double good enough for them?
Also, most analysts on the street feel this estimate is very
conservative, and the average estimate range is in the $4.50-$5
range. In fact, Trevor Gillard an analyst at Fleming Martin in South
Africa who has followed PGD for quite some time has a buy
recommendation up to the level of $5.50. This was as of Nov. 4,
1997, so estimates may be down a little, but so what. The stock
closed at $1.60 today so even $3-$4 in a year is a great return.
I understand your caution Wade. I have slowly been accumulating
shares over the last two months, and have been cautious as well.
Funny though. Sometimes I think back to about a year ago
or even eight months ago when the stock was around $8
and remember how stupid I felt because I hadn't gone with my
knowledge of the gold sector and my instincts and bought it when
it was in the $1.80 range back in October 1995. I was too cautious
then, and didn't understand just how profitable it can be if you are
astute about purchasing companies (in any sector) which have
weakened due to their sector being weaker, and not due to any
material changes within the company. I will never make that mistake
again.
PGD may not have been worth $8 when it was trading at that level,
but it is certainly worth more than what it is trading at now. Therefore,
I am going to wait for the herd at Nesbitt to sell off their shares, and
then I will be coming back in. It may be the best junior gold
opportunity since Barrick was in its infancy. Than again, it may
just double or triple over the next year. I can live with that.
What do you think Wade? Or anyone else out there?
Stephen
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