We held shares of DNDN back in May here Dendreon Preview before they reported 1st quarter results. We sold the shares in after hours after they announced 1st quarter results for a small profit. I did not feel at the time that the guidance was particularly strong and they would struggle to meet 2nd quarter results, so we sold the shares. Today investors are fleeing the stock as 2nd quarter results missed revenue estimates. Analyst were calling for 58M in revenues and the the company only produced 49M. But also the company refrained from giving any future revenue guidance. Below is a chart of DNDN with the after hours drop in share price of -61%.
Bottom Line: Growth stocks that do not perform as expected will get sold off. I wonder how many investors went into earnings holding shares without any option hedge or worse yet owned shares on margin. For a small amount they could have bought put protection, and this sell off could have cost them next to nothing.
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