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TheStreet Open House

Why Dendreon Corp. (DNDN) Is Up Today

Update (4:23 p.m.): Updated with closing price, day high and low prices, price change and volume information.

NEW YORK (TheStreet) -- Dendreon Corp.  (DNDN) rose 9.03% to $3.26, up from its previous close of $2.99, at the close of the trading day on Monday morning after the company announced its preliminary fourth-quarter 2013 revenue.

Dendreon hit a high of $3.48 and a low of $3.08 for the day and holds a one-year high of $7.22 and a one-year low of $2.23. On Monday, the stock had a volume of 17,158,698, nearly four times greater than its average volume of 4,421,270.

The Seattle-based biotechnology company announced it expects its net product revenue for the quarter to be approximately $74.8 million, a 10.1% sequential increase. The company also announced sequential growth in community oncology (19%), community urology (2%) and academic (5%). The report also stated that community accounted for 72% of total sales. Finally, Dendreon announced that its number of large accounts continued to grow to 100 in the fourth quarter, up from 94 in the third quarter, 85 in the second quarter and 54 in the first quarter.

Dendreon will make a presentation at the 32nd Annual J.P. Morgan Healthcare Conference in San Francisco on Jan. 15, 2014 at 2:30 p.m. PT.

TheStreet Ratings team rates Dendreon as a "sell" with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:

"We rate DENDREON CORP (DNDN) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • DNDN's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 46.51%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • DNDN, with its decline in revenue, underperformed when compared the industry average of 10.6%. Since the same quarter one year prior, revenues fell by 12.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • 42.91% is the gross profit margin for DENDREON CORP which we consider to be strong. Regardless of DNDN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DNDN's net profit margin of -98.84% significantly underperformed when compared to the industry average.
  • DENDREON CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DENDREON CORP reported poor results of -$2.65 versus -$2.31 in the prior year. This year, the market expects an improvement in earnings (-$1.74 versus -$2.65).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Biotechnology industry. The net income increased by 56.6% when compared to the same quarter one year prior, rising from -$154.86 million to -$67.22 million.
  • You can view the full analysis from the report here: DNDN Ratings Report

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