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Gold/Mining/Energy : Strictly: Oil and Gas Exploration Companies -- Ignore unavailable to you. Want to Upgrade?

To: PuddleGlum who wrote (207)	5/23/1999 5:53:00 AM
From: Robert T. Quasius	Read Replies (2) \| Respond to of 318

I think it is fundamentals that will raise AXAS. Also, if you analyze what insiders were doing in recent months, a large beneficial institutional owner started dumping the stock when it sank under about $3, while directors, officers, etc. had been heavy buyers (and continue to be) before that in the $3-5 range. Remember, this stock was selling at a high of about $20 about 18 months ago. AXAS has very high leverage, yet has so far been successful in remaining cash flow positive in 1998 and Q1 1999. AXAS took on a lot of leverage in restructuring assets. They like to buy up prospective property, sell it off after developing it, then buy up more. In this case, AXAS took on a lot of debt in buying a lot of high potential property in Canada and selling U.S. producing properties, just before the crash in commodity prices that took a lot of people by surprise. When fundamentals improve in a depressed industry, it is usually the well managed but highly leveraged stocks that show the most dramatic turnaround in results. I think the stock was priced by the street for BK, but this is now out of the question, unless commodity prices return to 1998 lows and stay there. With the high natural gas percentage holdings by AXAS, new pipelines from Canada, etc., I believe AXAS is well positioned to turnaround in 1999.