Myogen's Myopic Fans

These days, Wall Street analysts love Myogen (MYOG Quote) a whole lot more than regular investors do.

Virtually every mainstream analyst who follows the company has kept recommending the stock straight through a 35% plunge in the shares. The stock, which peaked at $42.27 back in March, has started to reflect clear concerns about a company that has no breakthrough drugs on the market as insiders continue to sell their own shares.

To be sure, it looks nothing like the wonderful investment opportunity that C.E. Unterberg Towbin analyst Andrew Fein started pushing a few months ago.

Back then, with especially poor timing, Fein initiated coverage of Myogen with a buy recommendation and a Street-high $58 target price on the stock. The call seemed like a decent one for less than three weeks. The stock rose about 7% during that time before plunging on news of an unpopular partnership deal that will cut into the company's expected profits going forward. TheStreet.com first started raising concerns about the company just a few days before that dive.

Meanwhile, analysts have never changed their tune since the slide began.

"Despite the bad news coming out of the company -- like the cash burn, the competitor's near-term successes, insiders' massive selling and a key executive departure -- not one analyst has downgraded the stock," notes Source Capital Vice President Robert Lawton, who touted Myogen as a great short-selling opportunity when the stock was fetching nearly $39 a share several months ago. "Andrew Fein doesn't even cover that many companies for Unterberg. So where is that guy? What does he do all day?"

Fein was out of the office when TheStreet.com attempted to reach him by telephone on Thursday. Fein was out of the office when TheStreet.com attempted to reach him by telephone on Thursday. His firm makes a market in Myogen's securities and hopes to secure investment banking business from the company over the next three months. The firm has a similar arrangement with competitor Encysive (ENCY Quote).