Dendreon Investors, Be Patient

I'm trying to take a break from Dendreon(DNDN Quote) but the emails keep coming: It seems plenty of investors are wringing their hands with worry because Dendreon's stock price isn't as high as they expected.

"Can you give us some updates on Dendreon," Karen W. asks. "This company is getting all the upgrades to 'Buy' and yet the stock is going down... I thought it would be at least $30 with the news."

Ben. L.M. writes similarly: "I don't understand what's going on with Dendreon since the release of their impressive Provenge data on Tuesday. The stock is down considerably from its $27-plus share price after the news was released... Is this a classic case of sell the news or is there some rumored skepticism about the quality of the study?"

Relax, people!

Dendreon isn't going to $30 overnight. All is well. The stock will probably work higher over time. Sensibly, hopefully, once the drama (insanity might be a more apt description) of this past week subsides.

Look at this way: For the past two years, Dendreon has been largely a trading vehicle, exquisitely sensitive to all types of rumors and innuendo. It takes time to transition from that short-term mindset to a stock that is more suitable for investment.

Dendreon is in the transition period now. This week brought concrete clinical evidence that Provenge extends the lives of men with prostate cancer. The data are good and consistent. As I said earlier this week, Wall Street spent Tuesday afternoon looking for red flags in the Provenge data, but came up with very little of consequence.