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Sotherly Hotels Inc. Message Board

  • HE9412 HE9412 Apr 17, 2009 1:45 PM Flag

    Suspicious trades?

    Today, I bought 1k shares at the bargain price of $.91 which is awesome. However, the weird thing is that my 60 day limit price was higher than that.

    I wonder why someone would voluntarily sell something less than what I was offering to pay...

    I understand that this is a thinly traded security so there can be significant spreads, but this is ridiculous.

    My suspicion is that someone short with a significant liability is playing games to keep the stock price artificially low.

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    • So someone does follow this stock and is actually buying it!

      Was your limit order an order for all-or-none or a minimum quantity? That could prevent it from going off and otgher orders going under it when volume is as low as with this stock. Volume is very light on this stock and spreads can be quite wide. Hard to read any tape here. The biggest encouragement is the insider buying the past several months. Granted, the dollar amounts are not all that great, but the whole market cap is only 8 million.

      • 1 Reply to paul_c85
      • The trade was a normal limit order with no special conditions. I didn't want to pay more that $1.05 but was shocked to pay less than the limit #. I have no idea of how the price is set.

        This is a risky stick in that it is such a small company and in a business that is affected by a recession. On the other hand, I believe (hence the buy) that it is worth well in excess of the current stock price and that it has been artificially beaten down. I expect to be buying more if the stock dips.

        I like the expected return on companies like this, since even if there is a 50% chance of bankruptcy (a made up # of course), the other outcome is likely a gain of 500% or more. With payouts like that, I only need 1 company in 10 to hit to break even. The secret is to spread your bets a bit and not put everything in just a few companies.

    • Do you know if the short interest on MDH is available, where, and how much is there? I also don't consider the price action very reasonable on many occasions. The specialist doesn't seem to maintain a very good market.

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