Small-Cap Spotlight: A Look at Crocs and Dendreon

In the case of a biotech that's unprofitable, I want a solid research platform, intellectual property and/or numerous early-stage treatments that aren't yet priced into shares. To me, going long Dendreon is nothing more than making a bet on Provenge, and that seems more like gambling than investing. I simply can't give my blessing to any investor looking to get into this stock at the recent price of $6.70 -- or at any price, for that matter.

As a closing note, let's not forget the stock sale by Dendreon's CEO Mitchell Gold immediately after shares popped in early April. The company did its best to explain that there was only a short window during which the executive could make a sale, but frankly I don't care. It looks terrible, smells fishy and makes me all the more happy to say "pass."

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Curzio: Speculative Buy-and-Hold

I also remember reading research reports for Dendreon back in January when shares were trading at $4. One report had a sell rating with a target price of $1.50 (which was recently reduced to $1.00), and another had a buy rating with a target price of $12. If you thought it was confusing then, it's a lot worse now. But unlike Larsen, I do see potential and think the drug is worth making a bet on, eventually.