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Black Diamond, Inc. Message Board

  • bosshebee bosshebee Apr 22, 2010 3:52 PM Flag

    Stock drop


    One thing that bothers me is the sudden drop to 4.80 and then a recovery to 5 or more. Tells me the stock is being jiggered. The company is now priced more than cash which may cause more shares to be issued in an acquisitoon plus I guess it will issue some debt. Also keep in mind that good acquisitions are getting scarce. I decided to bail out on the strength over 5. I may miss out but stocks are like women, lose out on one and there are plenty of other pickings.

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    • IMHO, that trade at 4.81 you are referring to was a clear head fake to drag the bid/ask down so that the real market player, that would be the buyer of 13,500 shares at 09:40 AM would be able to save a couple of $k's or so.

      Early this morning, someone ( either a fund or individual, don't care whom ) wanted to buy 13,500 shares. Problem was, the day's prior close was 5.15 and he did not want to pay that price. So, the simple solution is ... drop 100 shares right at the open at the market and thus draw down the bid/ask. Worked perfectly. Then, a few minutes later, they placed an order for 13,500 shares at the reduced ask of 4.99, thus saving about $ 2,160 ( not counting commissions ). Since the stock is so thinly traded, a 13,500 share trade used to be the total volume for a whole week earlier this year. Thus, the buyer, who instead of placing a few smaller orders at a time, chose to make one large trade.

      Bottom line, that 100 share trade at the open for 4.81 is really meaningless. JMESHO.

10.00-0.07(-0.70%)Mar 26 4:00 PMEDT