If approved, Provenge would be the first product in the new therapeutic class known as active cellular immunotherapies. In development studies, Provenge boosted survival rates in men with advanced prostate cancer beyond any currently available treatments. Unlike traditional vaccines that prevent diseases, Provenge treats it by stimulating the body's own immune system to attack cancer cells. Dendreon plans to market Provenge in the U.S. on its own and is seeking partners for ex-U.S territories.
 
Prostate cancer is the most common non-skin cancer in the United States and the third most common cancer globally as per data from the American Cancer Society. The disease affects more than one million men in the United States .
 
We believe that approval of Provenge is critical for the financial performance of the company because the product has blockbuster potential and its successful commercialization could drive a company of Dendreon’s size to strong profitability.
 
The company plans to manufacture Provenge in its New Jersey facility. Furthermore, additional manufacturing facilities in Los Angeles and Atlanta will begin producing the drug in the second half of 2011.
 
Currently, we have an Outperform rating on Dendreon.

Aflibercept, an anti-angiogenesis agent being developed for a variety of tumor types, was in a phase III study, which was evaluating the efficacy of the drug in combination with Eli Lilly’s (LLY) Gemzar (gemcitabine) versus placebo plus Gemzar for the first-line treatment of pancreatic cancer.

A planned interim efficacy analysis of the study, carried out by an independent data monitoring committee, showed that the addition of aflibercept to Gemzar would not lead to a statistically significant improvement in the primary endpoint of overall survival compared to the placebo plus Gemzar combination. The companies will conduct a detailed analysis of the efficacy and safety data, which will be presented at a future medical meeting.

The discontinuation of the study is a major disappointment for the companies. However, the companies noted that pancreatic cancer is among the more difficult-to-treat cancers with other experimental products failing to achieve significant benefit over existing treatments.

It is estimated that more than 42,000 people are diagnosed with pancreatic cancer every year. Eli Lilly’s Gemzar is considered the standard for the first-line treatment of metastatic pancreatic cancer. 

Sanofi-Aventis and Regeneron will continue developing aflibercept for the second-line treatment of metastatic colorectal cancer, the second-line treatment of non-small cell lung cancer (NSCLC), and the first-line treatment of hormone-refractory metastatic prostate cancer. The candidate is in phase III studies for each of these indications. Regeneron’s shares fell 6.9% in after-hours trading.

With the acquisition of Medarex, Bristol-Myers will get the UltiMAb Human Antibody Development System, which produces high affinity, human antibodies for use in a broad range of therapeutic areas, including immunology and oncology. It will also obtain Medarex’s next-generation Antibody-Drug Conjugate (ADC) technology, which is a novel and proprietary platform that could open new fields in cancer treatment.

Medarex’s has seven antibodies in clinical trials under its sole funding and is developing three other antibodies under partnership contracts. Importantly, Bristol-Myers will acquire full ownership and rights to ipilimumab, which, if approved, could be a major contributor to the company’s future growth.

Ipilimumab, a novel immunotherapy, is currently in phase III development for metastatic melanoma. It is also undergoing phase II study for lung cancer and other late-stage studies for adjuvant melanoma and hormone-refractory prostate cancer.

The Medarex acquisition should help Bristol-Myers offset the loss of revenue after its key product Plavix loses exclusivity in 2011. The company is building a strong pipeline of candidates to boost sales in the coming years. Additionally, management is working on reducing costs and shedding less profitable and non-core businesses.

We currently have an Outperform rating on the stock. We believe that the current price represents an attractive entry point for long-term investors.

While the advisory panel unanimously gave its stamp of approval to the injectable drug for prevention of bone fractures in women with postmenopausal osteoporosis, it stated that the drug should only be used by patients facing the highest risk of fractures. The ruling was based on safety and efficacy data from 30 studies of the drug involving more than 12,000 patients.

However, the panel did not approve use of the drug in the prevention and treatment of bone loss in women with breast cancer undergoing hormone ablation. It demanded additional data to ensure that denosumab would not hasten tumor growth in such patients, but supported use of the drug for prostate cancer as it appeared safer for men.

The committee also did not approve Prolia as a preventive measure for women with low bone density. The panel asked Amgen to provide more detailed data on denosumab before recommending it to patients who do not suffer from bone disease. It advised Amgen to submit a Risk Evaluation and Mitigation Strategy for Prolia, which could include a medication guide and a healthcare provider communications plan.

Even though the panel's advice is not binding on the FDA, it usually follows the ruling. The agency has set a Prescription Drug User Fee Act (PDUFA) action date of October 19. Prolia is also under review in the European Union, Australia and Switzerland, where GlaxoSmithKline (GSK) will market the potential multi-billion dollar blockbuster drug.

Despite only a partial nod from the panel, we feel that Amgen will be able to address safety concerns on Prolia and position it for blockbuster status. With all key products set to lose patent protection over the next few years (Enbrel - 2012, Epogen - 2013, Neupogen - 2013, Aranesp - 2014, and Neulasta – 2015), the company is depending on the approval and successful commercialization of denosumab.

We believe the candidate has potential to emerge as a leading cure for osteoporosis and will cater to a huge market, once launched. Osteoporosis affects about 10 million Americans, while nearly 45 million people are at risk. Global sales of osteoporosis medication hit $8.4 billion last year, including vitamin brands and drugs like Glaxo’s Boniva and Merck's (MRK) Fosamax.

We are bullish on denosumab, but any hiccup, either with respect to a delay at the FDA, a miss in any of the other ongoing late-stage programs, or safety concerns post-launch, will weigh heavily on the shares. We have a Neutral rating on Amgen.

Cougar Biotechnology has no products currently in the market but is developing oncology compounds for the treatment of advanced prostate cancer, breast cancer and multiple myeloma. The company’s lead candidate, abiraterone acetate (CB7630), recently entered the second of two phase III trials for the treatment of advanced prostate cancer.

Phase II efficacy and safety data in both chemotherapy-naïve and chemotherapy-experienced patients with hormone refractory prostate cancer looked compelling. We believe sales of abiraterone acetate could ramp very quickly upon FDA approval, expected as early as late-2010. Cougar is also testing abiraterone acetate for advanced breast cancer.

J&J’s pharmaceutical business has been struggling of late, with a number of its blockbuster drugs experiencing declining sales due to generic competition or safety concerns. In this scenario, we believe the Cougar acquisition would add value. It helps grow J&J relatively small oncology platform, an area of greater focus for the company in recent times as it offers high potential. CB7630, if approved by FDA, could see peak annual sales of $1 billion and would be an excellent complement to Velcade and Yondelis.

We believe J&J’s diverse and deep product mix, lack of cyclicality, strong financial position and consistent record of earnings growth will insulate it from a prolonged economic downturn. We have a Buy recommendation on the stock as we believe the company will offer long-term value with low risk in form of stable earnings and a diverse product portfolio.

Provenge, a therapeutic vaccine candidate being developed by Dendreon for the treatment of prostate cancer is likely to receive FDA approval in the first half of 2010. Unlike traditional vaccines that prevent diseases, Provenge treats it by stimulating the body's own immune system to attack cancer cells.

We remind investors that the company met with disappointment in 2007 when the FDA asked for further data before approving it. The disappointing news had caused the company to retrench 15% of its workforce and sent its shares on a downward journey.

However, in April 2009, Dendreon reported positive results from its IMPACT (IMmunotherapy for Prostrate AdenoCarcinoma Treatment) study of Provenge in men with advanced prostate cancer. Following the positive results, the company is once again gearing up to market Provenge once the FDA approval comes through.

Provenge has blockbuster potential; we estimate U.S. sales to be $120 million in 2010 and $200 million in 2011. If the drug is approved, we believe the company will be profitable in 2010. Dendreon will market Provenge in the U.S. on its own and we expect it to announce a partner for the drug in rest of the world soon.

Dendreon will market Provenge in the U.S. on its own. However, on a global basis, we anticipate a partner soon. Once sales start to flow, Dendreon can focus back on the development of its pipeline candidates once more.

Following the positive results announced in late April, Dendreon’s shares have been on the upswing and is trading above the $20 mark. The stock closed on July 2 at $23.48. We believe that the current share price represents an attractive entry point for long-term investors.

The U.S. government has allotted $1.1 billion as part of its stimulus package to study the medical treatment best suited for a given patient. This is an issue that haunts millions of people around the world. They seek the best treatment for themselves and their families and often end up spending more than the benefits of the treatment.
 
The prestigious Institute of Medicine (IOM) recently delivered a blueprint of the top 100 priorities. A few questions, which feature at the top of the list are: Which is the best treatment for patients with irregular heartbeat (atrial fibrillation) - medication or a surgical fix? Which is the best treatment for early stage prostate cancer- surgeries or different types of radiation? What are the pros and cons of cochlear implants, hearing aids, and devices meant for hearing loss? What is the ideal time for cancer patients to have an MRI, CT scan or PET scan? As part of its study, the IOM panel reached out to various sections of the society to explore different ways of preventing health problems. 
 
The issue of comparative effectiveness is likely to fuel fierce opposition from different drug makers and medical device manufacturers. While we believe big companies will benefit from this competitive pressure, the smaller ones will further lose market share to these biggies. Companies in our portfolio like Medtronic (MDT), Boston Scientific (BSX), and St. Jude Medical (STJ) are the few names who would benefit from this competition. On the other hand, relatively smaller names like ev3 (EVVV) will face the heat.

Chicago, IL - June 24, 2009 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Tiffany (TIF), Big Lots (BIG), Family Dollar (FDO), Isis Pharmaceuticals (ISIS) and OncoGenex (OGXI).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday's Analyst Blog:

Long-Term Job Stagnation

The two major forces behind the secular slowdown in job creation have been automation and globalization (off-shoring). It would not be particularly wise to reverse job losses coming from automation, since technology is the source of productivity growth and ultimately higher standards of living.

On the other hand, that model will not work to well if there are no jobs as a result. What will happen is that there will be a further hollowing out of the middle class, with a few extremely rich people and many who are struggling to make ends meet, and a growing number in real poverty.

This suggests that we will have sort of a bar-bell economy -- with strong firms that cater to the carriage trade, for example Tiffany's (TIF) and Neiman Marcus, as well as inferior goods firms that do well such as Big Lots (BIG) and Family Dollar (FDO). Firms in the middle will suffer.

Isis Generating Impressive Data

At perhaps the two biggest industry trade conferences of the year, the American Society of Clinical Oncology (ASCO) and the American Diabetes Association (ADA), Isis Pharmaceuticals (ISIS) and/or its partners presented encouraging pre-clinical and early-stage clinical data showing the potenital power of antisense technology as a new paradigm for treating cancer and diabetes -- two of the most widespread diseases in the U.S. and worldwide.

Specifically, at the ASCO meeting in early June, Isis and/or its partners held 4 presentations on oncology candidates using Isis' technology. Specifically, OncoGenex (OGXI) presented data from 2 phase II programs with OGX-011 that demonstrated very encouraging data. In a phase II program, patients with advanced metastatic prostate cancer were randomized to receive OGX-011 plus docetaxel or docetaxel alone.

The median overall survival (OS) for the OGX-011 plus docetaxel group was 23.8 months, vs. 16.9 months with docetaxel alone. This corresponded to a 39% reduction in the rate of death over the study period. OncoGenex hopes to secure a partnership for OGX-011 and move into a phase III program shortly.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Follow us on Twitter: http://twitter.com/ZacksInvestment

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Shares of Medarex Inc. (MEDX) soared the most in nearly a year after a mid-stage trial of its prostate cancer drug candidate was said to have cured two patients.

The Mayo Clinic in Minnesota reported that the drug, ipilimumab, when administered along with a hormone treatment and radiation therapy, was able to reduce the size of tumors to operable standards. Both patients had tumors deemed inoperable by surgeons since they expanded beyond the prostate into abdominal areas.

Medarex is developing the drug for treating melanoma, lung cancer and prostate cancer in collaboration with Bristol-Myers Squibb Co. (BMY). The mid-stage study for prostrate cancer involves 108 patients.

Medarex was trading up nearly 16% to $8.51 at noon on the NASDAQ after touching an intraday high of $9.01 earlier in the session. The shares had set a 52-week high of $10.12 in August last year.

A synopsis of today's Industry Outlook is presented below. The full article can be read at http://at.zacks.com/?id=2678.

Our best picks at this point include Myriad Genetics (MYGN), Onyx Pharmaceuticals Inc. (ONXX) and AMAG Pharmaceuticals Inc. (AMAG), Dendreon (DNDN) and 3SBio Inc. (SSRX). We have different reasons for a BUY rating for each of the four companies, but all of these companies have one thing in common -- strong balance sheets, which eliminates immediate financing needs.

Both MYGN and ONXX are already profitable. MYGN is a molecular diagnostic company. The company's molecular diagnostics business has been very strong and continued to grow impressively in fiscal third quarter of 2009 (ended March 31), and the outlook is bright even at the current economic environment. Our price target is $50.

For AMAG and DNDN, both are late-stage development companies. AMAG filed an NDA for its lead drug Feraheme (Ferumoxytol) in December 2007. Feraheme is indicated for the treatment of iron deficiency anemia, and we expect the FDA approval to come by the middle of 2009. AMAG is not profitable yet, but with Feraheme approval at its fingertips, the company should enjoy strong growth in the coming years. The balance sheet is strong. As of March 31, 2009, the company had $195 million in cash, cash equivalents and investments and no long-term debt. Our price target is $62.

DNDN's lead product candidate Provenge is indicated for the treatment of prostate cancer. The company reported positive results from its IMPACT phase III trial in April 2009 and will file a sBLA to the US FDA in fourth quarter of 2009. We estimate that the FDA will approve Provenge in 1H10. Our price target is $25.00.

SSRX is an integrated, China-based biotech company focused on developing and marketing therapeutics for nephrology, oncology and cancer supportive care. The company's flagship product EPIAO is the number 1 brand in the Chinese EPO market. Its second lead product TPIAO has gained rapid physician acceptance for thrombocytopenia, and is making a meaningful contribution to the company's top-line growth. A recent deal with US-based AMAG Pharmaceuticals Inc. will boost its expansion into IV Iron market. Our price target is $10.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today by visiting: http://at.zacks.com/?id=2679.

About Zacks 

The performance of the Zacks Rank portfolios shown above for annual and year-to-date periods are the linked monthly total returns (price changes + dividends) of equal weighted hypothetical portfolios, consisting of those stocks with the indicated Zacks Rank, assuming monthly rebalancing and zero transaction costs. These are not the returns of actual portfolios. The hypothetical portfolios were created at the beginning of each month from Jan 1988 forward based on the values of the Zacks Rank available to Zacks' clients before the beginning of each month.

The portfolios created monthly from 1988 through September 2006 exclude ADRS and are comprised of stocks that have the indicated Zacks Rank and were covered by at least two analysts at the time of the stocks inclusion in the portfolio. Starting in October 2006 and going forward, the portfolios are comprised of all stocks with the indicated Zacks Rank and do not exclude ADRs, which is more reflective of the list of stocks that customers will find on the Zacks web sites. 2007 returns are for the period of Jan 1 - Jun 30, 2007. These performance numbers have been audited from 1995 through 2003 by Autschuler Melovan, a division of American Express Financial.

The Biotech industry as a whole continues to underperform the market so far this year. As of May 26, 2009, Both the AMEX Biotech Index and the broader NASDAQ Biotech Index declined 6.8% (AMEX Biotech has 20 biotech companies while NASDAQ Biotech Index includes over 130 component companies), while the Dow Jones Biotech Index declined 3% (which includes 33 companies).

At the same time, both the NASDAQ Composite and S&P 500 have achieved positive returns. NASDAQ has made a gain of 11% as of 5/26/09 and the S&P 500 has gained 0.8%, while the Dow Jones Industrials reached a negative 3.5% return.

This constitutes a sharp contrast with last year when the Biotech industry as a whole achieved much better performance than the market. In 2008, all three biotech indices outperformed all three major market indices by a large margin. The three major indices declined as much as over 40% (34%, 41% and 38% for Dow, NASDAQ and S&P 500 respectively). While the NASDAQ Biotech Index declined only 12.6% and the AMEX Biotech Index was down 17.7%, the Dow Biotech Index actually had a positive 3.7% return in 2008.

This can partly be explained that when the recession gets deeper, even large-cap biotech companies will feel the pinch, while the smaller ones are still struggling with survival. Usually large-cap biotech companies, like large-cap pharma ones, have more resources to withstand economic downturns and financial crises than smaller biotech companies which have limited revenue and cash reserves. The current economic and financial environment has exerted negative impact on even large-cap biotech companies when patients curtail their out-of-pocket expenses.

Valuation is attractive though. The industry's average P/E (TTM) ratio has declined to 16x from a historical 35x to 40x. The five-year PEG ratio is less than 1 at 0.97, according to Yahoo Finance. But big pharma and biotech companies still face three major challenges: patent expiration, low research and development productivity, and generic competition.

We expect continued M&A activity in the remainder of the year after a series of mega deals in the first five months of the year. We believe the current market environment in the Pharma/biotech industry is favorable for M&A activity. With very active M&A's in the pharma/biotech sector, investors have every reason to speculate on buyout targets. Opportunity also exists in companies with decent pipeline which may attract big pharma or biotech companies for partnerships.

OPPORTUNITIES

Our best picks at this point include Myriad Genetics (MYGN), Onyx Pharmaceuticals Inc. (ONXX) and AMAG Pharmaceuticals Inc. (AMAG), Dendreon (DNDN) and 3SBio Inc. (SSRX). We have different reasons for a BUY rating for each of the four companies, but all of these companies have one thing in common -- strong balance sheets, which eliminates immediate financing needs.

Both MYGN and ONXX are already profitable. MYGN is a molecular diagnostic company. The company's molecular diagnostics business has been very strong and continued to grow impressively in fiscal third quarter of 2009 (ended March 31), and the outlook is bright even at the current economic environment. Our price target is $50.

Our BUY call on ONXX is based on strong performance of its cancer drug Nexavar partnered with Bayer Healthcare. Nexavar has been approved for kidney cancer and liver cancer, and sales remained strong in 1Q09 and will continue their momentum in the coming quarters. With profits at its back, ONXX recently in-licensed two cancer drug programs, while continuing to expand Nexavar labels. <P. With a cash balance of $467 million and no debt as of March 31, 2009, ONXX is well positioned for long-term growth. The company is also cooperating with Bayer for Nexavar, which makes it a potential and meaningful buyout target by Bayer. Our price target is $37.

For AMAG and DNDN, both are late-stage development companies. AMAG filed an NDA for its lead drug Feraheme (Ferumoxytol) in December 2007. Feraheme is indicated for the treatment of iron deficiency anemia, and we expect the FDA approval to come by the middle of 2009. AMAG is not profitable yet, but with Feraheme approval at its fingertips, the company should enjoy strong growth in the coming years. The balance sheet is strong. As of March 31, 2009, the company had $195 million in cash, cash equivalents and investments and no long-term debt. Our price target is $62.

DNDN's lead product candidate Provenge is indicated for the treatment of prostate cancer. The company reported positive results from its IMPACT phase III trial in April 2009 and will file a sBLA to the US FDA in fourth quarter of 2009. We estimate that the FDA will approve Provenge in 1H10. Our price target is $25.00. <P. We also have a Buy rating on 3SBio Inc. SSRX is an integrated, China-based biotech company focused on developing and marketing therapeutics for nephrology, oncology and cancer supportive care. The company's flagship product EPIAO is the number 1 brand in the Chinese EPO market. Its second lead product TPIAO has gained rapid physician acceptance for thrombocytopenia, and is making a meaningful contribution to the company's top-line growth. A recent deal with US-based AMAG Pharmaceuticals Inc. will boost its expansion into IV Iron market. Our price target is $10.

WEAKNESSES

We continue to be negative on SurModics Inc. (SRDX), Alkermes (ALKS) and Celera Group (CRA) based on financial performances from the most recent quarter ended March 31, 2009. The recession has finally taken a toll on both top line and bottom lines of these companies, and the outlook is not optimistic.

We also suggest investors avoid small biotech firms with weak balance sheets, particularly those which need immediate financing. Even with a promising pipeline, these small biotech firms may suspend operations and may be forced into survival mode without immediate new funds until current financial market and economic situations improve. We continue to suggest investors to avoid Genta Inc. (GNTA), Cell Therapeutics Inc. (CTIC), Decode Genetics (DCGN) and Cyclacel (CYCC). All these tiny biotech firms have great pressure for further financing in the next 6 to 12 months, and they have entered into survival mode in order to save cash. Zacks Investment Research

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579.

Here are highlights from Friday's Analyst Blog:

Drug Cos to Present at ASCO

Bristol-Myers Squibb (BMY) will be presenting updated survival data of its melanoma candidate, ipilimumab, from several phase II and phase III trials, both as a monotherapy and in combination with chemotherapy. Bristol will also have several presentations on Erbitux, including phase II data in combination with cisplatin in non-small cell lung cancer.

Pfizer Inc (PFE) will be presenting phase II data on Sutent in combination with docetaxel in patients with previously untreated hormone refractory prostate cancer.

Eli Lilly (LLY) will be making more than 50 presentations at ASCO 2009 including several on Alimta in NSCLC and Gemzar in combination with cisplatin in cervical cancer.

Amgen (AMGN) plans a very busy ASCO as well. Most of these are data presentations are results from testing Vectibix (panitumumab) in various stages and combination regimens for metastatic colorectal cancer. The company plans presentations by KRAS tumor status with Vectibix as well, plus several combination studies testing Vectibix and AMG-655 in lung, colorectal, and pancreatic cancer.

Biogen (BIIB) will be presenting results from a phase II study comparing volociximab and pegylated liposomal doxorubicin vs. doxorubicin alone in recurrent ovarian or peritoneal cancer.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=2649.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=2677

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=4580.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

* Verizon (NYSE:VZ) shares gained Tuesday amid rumors the company is in talks with Apple (NASDAQ:AAPL) about a possible new iPhone and/or Microsoft (NASDAQ:MSFT) on an iPhone competitor

* Dendreon's (NASDAQ:DNDN) drug Provenge was found to increase lives of advanced prostate cancer victims by 4.1 months, increasing the likelihood of FDA approval

* US Steel (NYSE:X) reported a worse-than-expected first quarter loss of $3.84 per share versus expected loss of $1.69 per share. The company slashed its dividend to 5 cents from 30 cents; expects another operating loss in the second quarter; plans 18 million common share offering and $300 million senior notes due 2014; will curb capital spending to $410 million from $740 million expected

* Waste Management (NYSE:WMI) reported first quarter results one penny better than anticipated at 42 cents per share, as revenues fell 14.1% year-over-year to $2.8 billion

* General Dynamics (NYSE:GD) reported first quarter earnings topping estimates by 8 cents at $1.54 per share, as revenues gained 18% year-over-year to $8.26 billion

* Hess (NYSE:HES) reported a first quarter loss of 18 cents per share, beating estimates by 9 cents, as revenues fell 35.8% year-over-year to $6.87 billion

* Wyeth (NYSE:WYE) topped estimates by 7 cents, reporting first quarter results of 95 cents (ex-items), as revenues fell 6% year-over-year to $5.38 billion. The firm reaffirmed its 2009 EPS guidance in the range of $3.33-$3.53; the Street expects EPS of $3.50

* Medco Health Solutions (NYSE:MHS) reported inline quarterly results of 63 cents, as revenues gained 14.4% year-over-year to $14.83 billion. The company expects full-year 2009 results in the range of $2.67-$2.77 versus estimates of $2.73

* Aetna (NYSE:AET) reported its first quarter topped estimates by 3 cents, posting at 96 cents as revenues advanced 10.5% year-over-year to $8.6 billion

* Time Warner (NYSE:TWX) reported first quarter results of 45 cents, 7 cents better than expected, as revenues fell 7% year-over-year to $6.95 billion. The company reaffirmed its 2009 earnings guidance of $1.98 per share versus estimates of $1.96

* Baker Hughes (NYSE:BHI) reported first quarter results of 82 cents, beating estimates by 6 cents as revenues fell 0.1% year-over-year to $2.67 billion

* ArcelorMittal (NYSE:MT) reported a 78 cent first quarter loss, missing estimates by 39 cents, as revenues fell 49.3% year-over-year to $15.12 billion

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579.

Here are highlights from Monday's Analyst Blog:

VLO Entering the Ethanol Business

Valero Energy (VLO), the largest North American refiner, has entered the ethanol business in a big way by acquiring the eight (8) ethanol plants of the bankrupt VeraSun Energy in a bankruptcy court auction. (VeraSun Energy went bankrupt in October 2008.)

Valero paid a total of $552 million (including adjustments for working capital) for the seven existing and one under-construction plant, which have a combined capacity of 760 million gallons per year (roughly 51,000 barrels per day). All the plants are located in Midwestern states.

PartnerRe Nicely Priced

Based in Bermuda, PartnerRe Ltd. (PRE) was formed in 1993, raising nearly $1 billion in an IPO to capitalize on the void in catastrophe reinsurance capacity following Hurricane Andrew and the concurrent difficulties faced by Lloyds of London. While beginning as a pure property reinsurer, the company has become a dynamic and diversified property-casualty (P&C) and life reinsurer over the years. At December 31, 2008, total assets were $16.3 billion, total capital was $4.9 billion, and total shareholders' equity was $4.2 billion.

PartnerRe will release its 1Q09 results after the market close on April 27, 2009, with a conference call scheduled the next morning. Its 4Q08 operating earnings of $53.9 million or $0.95 per diluted share were substantially short of estimates, primarily due to an unusually high tax rate.

Cautious on Dendreon's Rally

Shares of Dendreon Corp. (DNDN) jumped 38 percent last Friday and another 13% in early morning trading today. However, we don't see any clear rationale for the rally at this point of time. We believe investors are looking ahead to long-awaited data on the company's experimental Provenge vaccine to treat advanced prostate cancer, but we are cautious about the final results anticipated by the end of April.

As a reminder, Dendreon's lead drug candidate Provenge is under phase III IMPACT confirmatory study for prostate cancer under a special protocol assessment (SPA) with the FDA. Provenge is a therapeutic vaccine.

Sell DELL to $7 per Share

The rapid decline in corporate profits, highly illiquid capital markets, and the recessionary outlook are likely to dampen corporate capital spending. This is likely to have a major impact on Dell Inc.'s (DELL) server business.

Adding to this is the continued decline in consumer spending as shown by the decrease in sales of PCs and cell phones over recent months. Dell posted lackluster Q409 results as demand for equipment remained weak, although cost-cutting initiatives have helped boost its bottom line. The company's marketing model of being the lowest-priced supplier to the consumer in a declining market is likely to reduce margins over the coming quarters.

Hot Topic to Cool Off a Bit

We are downgrading Hot Topic Inc. (HOTT) shares from Buy to Hold. The stock has ripped 33% higher in the last four weeks, outperforming the rest of the market during the explosive rally off the March lows.

After a strong run, it makes sense to take profits in the name. What's more, we think Hot Topic's valuation may be a little stretched. While we continue to expect the retailer to report strong results, those expectations are now reflected in HOTT shares.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=2649.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=2677

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=4580.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

• Standard & Poor’s yesterday (Monday) reduced the credit rating of Royal Bank of Scotland PLC (ADR: RBS), lowering the rating of both the Edinburgh-based bank’s long-term and short-term debt. “The rating actions reflect Standard & Poor’s expectation that RBS’s financial profile may continue to weaken,” the analysts said, citing a “combination of mixed earnings prospects, deteriorating credit risk in its key geographies, and difficult market conditions” in which to shore up its capital, Bloomberg News reported. RBS stock sank over 20% on the downgrade.

• Shares of biotech firm Dendreon Corp. (DNDN) soared 33% yesterday (Monday) on news of a good drug trial. Provenge, Dendreon’s experimental prostate cancer drug, reduced the risk of death in 20% of trial participants, Reuters reported. Dendreon shares gained $1.73 to close at $6.93.

• Eli Lilly & Co. (LLY) announced yesterday (Monday) that it plans to buy ImClone Systems Inc. (IMCL) for $6.5 billion in a deal that values the biotech firm at about $70 share. This latest offer from Eli Lilly beat out Bristol Myers Squibb Co.’s (BMY) competing bid of $62 per share. However, Bristol Meyer’s will receive approximately $1 billion in cash for its 17% stake in ImClone, The New York Times reported.

• AgFeed Industries Inc. (FEED) announced yesterday (Monday) a $10 million share repurchase program to commence immediately. AgFeed, which does most of its feed and hog production business in China, will fund the share buyback with current cash reserves, Trading Markets reported.

• Bank of America Corp. (BAC) yesterday (Monday) reported third-quarter results earlier than planned, and revealed a 68% drop in profit, as well as plans to boost capital by selling stock and halving its dividend. Profit fell to $1.18 billion, or 15 cents per share, for the July-to-September period from $3.7 billion, or 82 cents per share, in the same period last year.

• U.S. Treasury Secretary Henry M. Paulson selected Neel Kashkari, a former Goldman Sachs Group Inc. (GS) executive and current assistant secretary to be the interim head of Treasury’s new Office of Financial Stability, The Associated Press reported. Kashkari will be in charge of the office created by the emergency legislation enacted Friday to fund the largest government bailout. Paulson was the head of Goldman before joining the Bush administration in 2006.

Source: Global Investing Roundups Tuesday, October 7th, 2008

The Food and Drug Administration's approvable letter was a surprise to us since it usually follows the advice of its expert panel which recommended the immediate approval of Provenge at its March 29, 2007 meeting. The decision may delay the approval and launch of Provenge until 2009 at the earliest. Approval of Provenge is critical for the financial performance of the company because the product has blockbuster status and successful commercialization of Provenge can drive a company of Dendreon's size to strong profitability.

Unless the company signs a commercialization deal for Provenge, the only upcoming positive catalyst is the presentation of interim results from the IMPACT trial. However, the presentation of results will take place only in the second half of 2008. We expect the share price of Dendreon to remain volatile until then.

We are not overly concerned with the company's cash burn at this moment. The company ended the second quarter with $127 million in cash and cash equivalents. Additionally, the company secured a $130 million committed equity financing in September 2007. Our target price of $6.50 corresponds to a market cap of $600 million.

Read the full analyst report on DNDN