The first lesson any poker player should learn: Always look for a reason to fold.

Which brings me to the conundrum that is Mandalay Resort Group (NYSE:MBG). The hotel/casino operator reported third quarter results yesterday afternoon, and it's the same story as last quarter: Las Vegas is on fire. Yet, insider action at this company is very unsettling.

More resort than casino, you won't hear Mandalay talk much about "hold percentages." Operating cash flow at the company's Las Vegas Strip properties jumped 24%, as revenue per available room (REVPAR) climbed 19%. Further, as net revenues at the three South Strip properties -- Luxor, Excalibur, and the flagship Mandalay Bay -- climbed 9% to $342 million, gaming revenues accounted for only 30.5% of net revenues, vs. 32% last year. This helped drive net income up 22% to $40.6 million, or $0.63 per share.

Mandalay's shares carry a premium valuation, and with good reason. Adding to the optimism surrounding Las Vegas, the company recently opened its upscale shopping mall at Mandalay Bay -- similar to the Grand Canal Shoppes at The Venetian and The Forum Shops at Park Place's (NYSE:PPE) Caesars Palace. And in just two weeks we'll see the grand opening of THEhotel at Mandalay Bay, a 1,122-suite tower. In fact, Las Vegas is so hot that the company is considering adding another property to the market.

Of course, there's a flip side.

Outside of Las Vegas, Mandalay's other Nevada properties are still being pinched by tribal gaming in California. Trying to get a permanent casino built in Detroit before Super Bowl 2006 has been a pain, and the gaming tax situation in Illinois is still hampering cash flow at the Grand Victoria boat near Chicago.

And then there's the part about CEO Michael Ensign and Vice Chairman Bill Richardson sellingall of their shares, and without explanation. For all the reasons one might have for selling a stock, there are zero good ones for why the top two people in your organization should sell out completely -- especially at the same time the company has been using its shareholders' equity to buy back shares. In stark contrast to Fred Hassan's recent move at Schering-Plough (NYSE:SGP), it's a sign of poor leadership, at best.

In the absence of a reasonable explanation, the insider stock sales are either extremely bizarre or extremely crooked. Why even bother sticking around to find out? There are certainly more lucrative and less risky places for your investment dollar. Maybe Mandalay is just too hot.

The bottom line: If you're holding Mandalay shares, just take the insiders' lead and fold the hand.

Visit the Mandalay Resort Group discussion board -- only at Jeff Hwang can be reached at [email protected].