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

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

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To: Gemini who wrote (2418)	4/24/1998 8:23:00 AM
From: david james	of 2841

I have to agree with the last couple posts. The stock could go a bit lower, and it would be painful to get a margin call any lower. But I don't think it will go much lower. We are not far over book value. Think of it this way. At Eco's current price, if just about any company in this industry were to acquire Eco now, it would likely be accretive to their earnings and reduce their P/E. We've got a market cap of about $140 mill and a backlog of around $250 mill. That gives us a price to sales ratio of under 0.6. And unlike about half the companies in the industry, we will be profitable. I also think we will be cash flow positive for the rest of the year (unless Eco tries another one of those clever "investments"). Eco has done a lot of dumb things in the last several months to really piss off some of their long term shareholders and institutions - hence the current price. They've now got to try and build some confidence again. I personally think that the 70 to 80 cent estimate they put out for the year is on the conservative side, and they will beat numbers easily. If they do, that will help. But you need to make your own risk reward decision. From what I understand, Eco is about to hire some PR firm that specializes in putting companies in front of institutional clients. Hopefully, this is a better group than the "stock-up' group they hired last year. According to IR, this will happen shortly. The shareholder meeting is at the end of May. Between now and then, I suspect Eco will make at least some attempt to demonstrate that the company is healthy and that things are looking brighter. If McGinnis has anything up their sleeve, I suspect they will play that card between now and then. Otherwise, it could be a rough meeting. David

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