American Eco (ECGOF, ECX on Toronto exchange) Message Board

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Gold/Mining/Energy : American Eco (ECGOF, ECX on Toronto exchange)

ECX 1.655

-0.6%

Dec 23 3:59 PM EST

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To: Michael Anthony who wrote (2032)	3/6/1998 1:02:00 AM
From: Raymond James Norris	Read Replies (1) of 2841

Michael, I enjoyed your recent post: Forget the numbers, they are obviously meaningless as the price over the last years have shown. Yes of course. Numbers should not be used. Let's get out our tea leaves...... What kind of comment is that? Forget the numbers? What should we then base any evaluations on? Our intuition? Our experience? Perhaps your opinions? Unlike you I'm not going to forget the numbers. I know what Eco made and we now have a Big 4 firm confirming. Not bad at all. If they didnt meet your expectations, your broker can always sell your shares. It's your choice. I simply disagree on how you came to that decision. They grew earnings 33% with 10% tax. They will be taxed 37% this year. At the same earnings growth rate, they should make about the same this year. Bravo! Bravo! And do you think the Street won't notice this wonderous revelation?? Of course we'll earn the same assuming all the factors are kept constant (30% growth on top of 30% tax). However the Street has this amazingly ability when evaluating companies. It's called reason. It can account for these differences over quarters. Have you ever seen a company report "before gains" or "before charges" earnings? They might have a charge of 5.00 which gives them a negative p/e, but the stock doesn't trade at 1$ per share. It trades at what the earnings would have been had these one time occurrences not been laid upon the stock. The same matter occurs with Eco. If you think the Street is stupid enough to not notice taxed earnings to untaxed, you've got another think coming. Of course they can recognize it and will reward Eco accordingly. The stock wont fall back to 8 on news that it made .25 in its 1st Qtr vs. .25 of 97 on 30% tax versus 0 tax. Taking those factors into account will yield a different story. And when we do have taxed vs. taxed, you'll truly see Eco's strong growth once again. How will the stock do tomorrow? I have no idea. But what I do know is the company is certainly not fairly valued at 10.00 a share. And in time, as has been reiterated, it will achieve fair value. I'm simply going to hold on and wait for that. If you don't have the time, patience, or whatever to hold, then it's probably best to sell all your shares. Conservatively Yours, Raymond J. Norris

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