I'm not sure why you think that the spread is indicative of demand. I was under the impression that it was indicative of liquidity and perceived risk by the market makers. Iomega regularly traded with a 3/8 spread in April/May of 96, after it split the second time and had it's secondary, the spread narrowed to 1/8 where it stayed through it's fall to 12 5/8. I think it erroneous to think that the spread widens when a stock is falling. Today's rise was on less than average volume, although it was a shortened day. Price hit 47 and quit. This is a high risk position, whether long or short. I must admit the buying is not unimpressive, but it is not spectacular *considering* the market environment that we're in. Right now I think 30 is not an unreasonable price target, and I am as certain as I can be that it will reach that price before December. Believe me, if it becomes appropriate, I can switch to the long side on this security with just a click or two of my mouse. Right now though, I see a company with a huge PSR and PE (even on forward projections, a twin test of the all time high,and a mob of venture capitalists waiting for payday. We shall see.
Barb |
