Social Market Analytics Looks at Sentiment Surrounding Upgrades for Dendreon
This week, Social Market Analytics (SMA) looks at Dendreon Corp. (NASDAQ: DNDN), a biotechnology company with an emerging product portfolio of novel therapeutics to enhance cancer treatment options for patients, most notably Provenge for the treatment of prostate cancer. The week of January 7 yielded very positive results for long suffering Dendreon shareholders as the stock surged 21% on January 11, its largest gain in a year, on optimistic expectations of a 10 to 20 percent increase in the use of Provenge this year as the drug continues to gain acceptance. DNDN stock received a sudden upgrade at Sanford Bernstein to “Outperform” and revised price targets at twice the closing price of January 11, with the stock reacting accordingly. During the week, DNDN appeared on SMA’s morning Flash Report, which identifies stocks, in the pre-market, with extreme sentiment levels that are likely to trade with high activity during the upcoming session. In the pre-market of January 11, our analytics engine identified DNDN as a stock with the extreme positive market sentiment from the universe of stocks tracked by SMA. As the week evolved, SMA’s metrics provided initial indication and later confirmation of positive sentiment for DNDN as the market integrated the exceptionally positive analyst views expressed on the company.
Beginning on Monday, January 7, SMA’s S-Score and S-Mean metrics for DNDN began a transition from negative to strongly positive territory. In the pre-market of January 7, DNDN’s S-Score posted a firmly positive level of 1.56. This action accelerated over the next two days as DNDN’s S-Score increased to 2.51 (High Positive) in the pre-market of January 9 coincident with a spike up in DNDN’s S-Volume metric indicating unusual social media activity for the stock. The behavior of SMA’s S-Score measures market trading sentiment and can provide actionable signals for upcoming price movement. In the pre-market of January 11, our analytics engine detected a continued uptrend for DNDN, with a surge in S-Score to 3.48 (Extreme Positive). DNDN opened the January 11 session at $5.80, a strong gap up of 13.7% from its previous close, and continued to rally, on high share volume, to close at $6.17, a gain of 21% for the day and at a price level not seen since July, 2012.
Social Media data are noisy and complex. A single metric is insufficient to understand sentiment behavior over time. Our S-Factors are a family of metrics, including volatility, trend and volume measures, designed to provide a complete view of social media signature for each security tracked in SMA’s databases. SMA's processing engine continuously updates our S-Factors, capturing overnight and pre-market sentiment activities. Clients receive sentiment reports prior to the U.S. market open and intra-day sentiment estimates for tracked stocks, on-demand. Clients have access to our Sentiment Alerts feature, which provides real-time notification of changes in sentiment metrics for the stocks on a client’s customized watch list. We invite the reader to visit our website; investigate our market sentiment metrics for DNDN, other stocks, industry sectors, and market indices; participate in our FAQ forum; and sign up for our Flash Report and Newsletter.