Borislav Tonev

Tobin Smith Revives Gray Fox Petroleum Corp (OTCBB:GFOX)

by Borislav Tonev May 23, 2014

81GFOX.pngIt's been about six months since Tobin Smith launched a landing page (which is still up and running) and said that Gray Fox Petroleum Corp (OTCBB:GFOX, GFOX message board) can reach a short term target of $6.20 per share. Don't know who Tobin Smith is?

He is an ex-Fox commentator who often receives money for promoting small cap companies. His former employer decided to fire him when they found out that he was pumping Petrosonic Energy Inc (OTCMKTS:PSON). As if that wasn't bad enough, his track record is not exactly spotless. Among his latest picks are HydroPhi Technologies Group f/k/a Big Clix Corp (OTCMKTS:HPTG) and Ener-Core Inc (OTCBB:ENCR) and the two charts (link1 and link2) show just how badly the two tickers performed under the pressure.

It's much the same story with GFOX. The hype and excitement created by Mr. Smith's touting did push the stock towards the higher end of the chart initially and on March 3, it reached an all-time high of $2.71 per share.

GFOX's chances of surviving the pressure at these levels were slim. We tried to warn investors about this and we also mentioned the fact that back in 2012, the company sold more than 16 million common shares at just $0.00125 a piece. Twenty-five unnamed investors got the discounted stock and we were wondering if they are not eager to sell their shares and make a profit out of the artificially inflated price.

GFOX then went on to crash rather spectacularly. A month and a half after hitting the $2.71 high, it dropped below $1 which was apparently a good enough reason for the emails to stop. The volumes died down and, instead of reaching Mr. Smith's $6.20 target, GFOX went under $0.50 on May 7.

Seemingly, nothing was going to get it out of these levels and yet, over the last few days, we've seen the ticker shuffling again. GFOX registered four green sessions in a row and after a 10% jump yesterday, it's back above the $1 mark. The dollar volume stands at $363 thousand which is an unusual amount of interest for a stock that has incinerated so much money in such a short period of time. Take a look into the reasons for the sudden surge, however, and you'll see that it's not at all that surprising.

Apparently, Mr. Tobin Smith has received another $20 thousand and has picked GFOX up again. A new landing page has been set up and it's presented to investors through online ads on various websites. As you can see from the link, Mr. Smith, without telling us why he decided to do so, has lowered the short term target to $2.25. The question is: "Can GFOX reach it?".

3GFOX_logo.pngAs you probably know, anything is possible in Pennyland, but you should probably bear in mind that things are not looking particularly well. Yesterday, the company issued an update on the operations and said that phase two of the eight-step exploration plan has been completed. They also said that the well permitting process and the confirmation of the drilling strategy should be ready by the end of May 2015.

That's twelve months from now which is an awful lot of time in Pennyland and it won't even mark the start of the drilling process (no deadlines were given for that). Investors need to be patient while waiting for the results and they should also think carefully about the 16 million discounted shares before putting any money on the line.

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