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Real Story: Cancer Drug Mania

Adam Feuerstein dissects the wild moves in Dendreon, Cell Genesys and others. Plus, David Peltier on Dow Chemical, Buffett's latest investment and the Geoff Tate Zone.
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has clearly become a "momentum play" vs. trading in fundamentals, Adam Feuerstein tells Aaron Task on Monday's

The Real Story podcast.

But the biotech stock "could see $40" if its Provenge prostate cancer drug gets full FDA approval, says Feuerstein, a senior writer at

. The biotech columnist was less upbeat about

Cell Genesys


, however, expressing a lack of faith in the company's own prostate cancer vaccine, GVAX.

More to the point, Feuerstein says there is a "mania" developing for cancer drug stocks in the wake of Dendreon's huge rally in the past two weeks, noting that



was soaring Monday on the hope the FDA will re-review its prostate cancer treatment, Xcytrin, which an FDA panel previously rejected.

The mania notwithstanding, Task says "all biotech ETFs" are not created equal, noting that the

Biotech HOLDRs

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were down Monday despite all the excitement over cancer drug stocks and a huge rally in



, amid rumors that


is taking the company's experimental blood-clot dissolver into a stroke trial.

Task's second guest Monday was David Peltier, editor of's

Dividend Stock Advisor . The newsletter has a longstanding position in

Dow Chemical

(DOW) - Get Dow, Inc. Report

, which jumped 5% Monday on another round of rumors of a potential private-equity buyout. Peltier says the stock is worth holding even if no buyout emerges, because of Dow Chemical's strong earnings growth and healthy dividend.

Task and Peltier also discussed news that billionaire investor Warren Buffett's

Berkshire Hathaway

(BRK.A) - Get Berkshire Hathaway Inc. Class A Report

has purchased a 10.9% stake in

Burlington Northern



"It never pays to bet against Buffett," says Peltier, who also pens's

Value Investor newsletter. Still, investors are betting off taking a position in

Berkshire Hathaway

"B shares" than chasing stocks after news of a Buffett stake is revealed, he says. "That has not been a winning strategy."

Outside the biotechs and rails, Task notes many of the day's "story stocks" were winners, including

Peabody Energy

(BTU) - Get Peabody Energy Corporation Report






(AMD) - Get Advanced Micro Devices, Inc. Report


While AMD rallied despite its revenue warning. Task notes that shareholders of other stocks caught in what he calls "The Geoff Tate Zone" were not so fortunate. Shares of


(SANM) - Get Sanmina Corporation Report



(DAKT) - Get Daktronics, Inc. Report


Conexant Systems

(CNXT) - Get VanEck Vectors ChinaAMC SME-ChiNext ETF Report





American Home Mortgage Investment


were each down sharply after issuing disappointing guidance.

In the remainder of the podcast, Task provided some speculative suggestions for listeners participating in's

"Beat the Street" contest, a fantasy trading game.


here to listen to the entire podcast.