March 07: Week 5 - Dendreon Corp (DNDN), Billy Ray Valentine, Citigroup (C), EDGR, and Huey Lewis


Dendreon Corp: The Good, the Bad, the FDA
It's all about the Dendreon Corporation (DNDN) and after their shares were halted yesterday, today the stock is up 143% and was up over 200% this morning. Yesterday shares were halted at $5.22, today it's trading around $12.80. Before you bet the farm on this stock, keep in mind it was an FDA Panel that said Provenge is okay, not the FDA itself. The Bottom line: The FDA does not have to follow the panel's recommendation.
Look, everyone wants a new drug to treat cancer and you can bet Huey wants a new drug, but is Provenge safe and will the FDA say "Yes"? The panel voted unanimously yesterday that Provenge was fairly safe. It rewrote a question regarding whether the treatment is effective, instead asking if there was "substantial evidence" of its efficacy. The panel voted "Yes" by a 13-to-4 margin.
So what's the big deal about anyway?
After spending 10 years and $400 million to develop and test its prostate cancer drug, Seattle-based Dendreon today now faces the U.S. Food and Drug Administration to decide if Provenge is safe for the public. So what's to gain? Money baby, lots of money
The Good:
- Dendreon is the only Seattle biotech company with a potential blockbuster drug, meaning that analysts project annual sales could reach $1 Billion.
- It's the first treatment of its kind against cancer and one of the only drugs targeting late-stage prostate cancer patients .
- Provenge's side effects, including fever and chills, are generally fewer than chemotherapy drugs

The Bad:
- There is conflicting data from Dendreon's clinical trials. One study of 127 patients with advanced, metastatic prostate cancer did not meet its goal, which was to delay the time toward progression of the disease.
- Two clinical trials didn't achieve their stated goal of delaying the disease's progress, but a long-term statistical analysis suggests that patients receiving the treatment lived longer than others.
- The company is enrolling patients for a final study that won't produce results until 2010. The FDA might request to see that data before approving the drug.
Dendreon shares have climbed through the roof in the last 5 days and experts are saying their drug has a 50/50 chance of getting the green light from the FDA. Gentlemen, place your bets.

Citigroup could be money in the bank

What happens when your company stock hasn't moved in three years? Job cuts. Citigroup (C) is planning to shed 10,000 to 12,000 jobs this year and some 14,000 additional positions will be lost to attrition or relocated from high-cost locations — including London, Hong Kong and New York, where the company is based .
Citigroup is an army, those job cuts will impact around 8% the company’s 327,000 employees which are located on about every corner of the earth. This new restructuring program should reduce costs by more than $2 billion a year. Just consider Citigroup reported net income of $21B last year, these guys practically print money.
Citigroup does pay out a nice dividend of 54 cents a quarter which was recently raised from 49 cents. Considering their shares have dropped 9% in the last three months and the share price is getting closer to its 52-week low these job cuts were inevitable. Today Citigroup shares are trading around $51 and change.
Citigroup is a monster company, it's hard to imagine shares dropping much lower and considering they have 200+ million customer accounts in more than 100 countries, can you say 1-2-shabadoo?

EDGAR Online Inc. (EDGR) hits a new 52-week low today with shares trading at $2.72. The leading provider of interactive business and financial data on global companies to financial, corporate and advisory professionals can't seem to get its own financials under control. How's that for irony? Chances are if you ever have read a company's financials, it was done by Edgar. For the past 7 years shares of Edgar have been trading under $5. Think they can go higher? You make the call.

No Docs? No problem...Until now
Christmas is around the corner, and I ain't gonna have no money to buy my son the G.I. Joe with the kung-fu grip! So they're panicking right now, they're screaming "SELL! SELL!" to get out before the price keeps dropping. They're panicking out there right now, I can feel it." ~ Eddie Murphy, Trading Places
Housing has been on a tear for the last decade and the inevitable happened, people realized if a company is not able to earn a profit, or even demonstrate a realistic plan of how they might, it really is not worth $144 a share and the prices of these stocks then fell off a cliff.
There are three main categories of no-documentation mortgages:
1. NINA (no income, no asset) mortgages
2. No-ratio mortgages
3. Stated-income mortgages
There are trillions out there looking for a home to grow in, what happens to the bottom 1% or 2% to the mortgage market will not really effect us except entice those trillions to look for a better home. The US stock market welcomes you.
Do not let the doomsayers out there scare you, let them panic and keep your cool like Billy Ray Valentine... see the movie. Read article at ValuePlays...

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