Spanish,

I think you really need to consider what you are doing and why you are doing it. First, a manual penalty means you are on Googles radar and you are outside their terms of service in some way. If your decision is to get a new domain then what you should do is put the old one in the trash and forget it ever happened. You are starting from square one if you are smart IMO. Why? because if it is a penalty around linking and you redirect to a new domain, you are going to carry that wait to the next site. That doesn't mean that the penalty will show up on your new domain at point just because of the old, but there is no real value in the links so why risk it? There are just too many reasons not to try and save the old and move it to the new with redirects. BUT, is there a reason you would not simply address the penalty? Maybe it is cost as cleanup is expensive; if so, you weigh cost of cleanup versus cost of rebuild to all new site with new domain.

Second, an "algorithmic penalty" is something we say from time to time, but if you are using that as a line of thinking - "the algorithm has in some way penalized us" - you are then setting yourself up for further pain down the road IMO. With a site failing to rank because you have bad links, poor content, ads everywhere, I suggest you not look at it as a penalty. Look at is as: "What must we do in order to grow our site in value to our customer and in ranking against our competitors?" If you believe you have a "penalty" of sorts you are really saying things are not as good as they could be. Why not change things? If it is linking, disavow bad domains and links and move on. If it is Panda in your thinking, what can you do to change the content, etc.?

Often, when this type of question arises there have been a series of missteps by a site owner trying to shortcut really building a web property. If there were true short cuts without risk, I can tell you I would have found them or learned of them from people on various forums like Moz. I simply do not know of any.

Clean things up and move on or start over and move on. I think that is the only choice you face. I wish it were easier for all of us. 
Best

C Nature Travel

There are a lot of people who wonder about this. First, many of us thought the past year would show a real decrease in exact match domain name strength for SEO and I don't know that it has really changed that much. As to any value, there are simply two opinions: One group says it looks spammy the other says that it is easier to read.

We do SEO/SEM and WebDev/Design for clients. We have clients who have hyphens and those who don't and we do not see any appreciable difference. Frankly, as to "domain value" I do not really think there is a difference for a basic term. If it were branded it might be a bit different. If you have concerns as to value, buy both and 301 one to the other (your call as to which you have it finally resolve to).

In my opinion, neither has more SEO value. It is really up to you and your client. I like the hyphens for readability but, hey, I wear glasses.....

Have fun,

IMM

My first suggestion will be that you take a step back so you can save a few steps.

You need to be clear as to what you are targeting and here is why: If, your intent is to use Spanish words on English search here in the U.S. (I am in Texas, speak Spanish, handle multi lingual sites, etc.) you need to know which terms are going to return for English, Spanish, or both. Unless you are using a term that readily goes across both languages you need to go either/or there is no Spanglish to speak of. Examples are search on ropas (see screen shot) and you will get both types of languages returns. Change the search to vendes ropas or vender ropas and it is almost all returned as Spanish. Then, search on abogado and you will see English and Spanish sites. (Dumb English speaking sites, yes).

Another question is when you say hispanics, what are you targeting? People from various Spanish, Latin American, or South American countries who now reside in the US and speak Spanish only? Those who speak Spanish and English and are from a hispanic country but living in the US? Or a specific geo target area  of hispanics within the US? Remember that the majority of hispanics in the US speak English as their primary language.

So, to do KW research, you need to get clear on what it is you are selling and to whom you are selling it. Then you can become a laser for the language.

But, I would also say you need to be clear as to how you are translating and what is needed with regard urls, etc. When you have two languages on a site, you need to make sure you handle it correctly.

Hope this helps,

Hey Doug, 
Gianluca had answered a question a long time ago using these and I could not find the question again after a 30 min search. Thanks,

Gianluca's point was that Google did not see hyphens as spam and not to worry about it as I recall.

I would personally use hyphens if there was a domain I wanted that was unavailable and the hyphenated version was. If I wanted it, I would obviously believe I had the ability to rank for it in the likelihood someone used the non hyphenated.

I was wondering, is there a nonexpertsexexchange.com?? I can understand getting a discount for having a novice over an expert, but this seems extreme;)

Best