Midday Commentary: Alpha Natural flat after Goldman upgrade; Dendreon eyed on positive drug data

By Rebecca Melvin

New York, Sept. 27 - The convertibles of Alpha Natural Resources Inc. and Dendreon Corp. were in focus in early trade Friday after news out from those companies.

Alpha Natural's 2.375% convertibles due 2015 traded in odd lots at 94.4375 in the early going, according to a New York-based trader. That was little changed from previous levels, he said.

Shares of the Bristol, Va.-based coal producer were off 3 cents at $6.24. The pressure came despite news that the shares were raised to "neutral" from "sell" by Goldman Sachs.

Goldman also raised its price target on Alpha Natural shares to $6.00 from $4.00, but the shares had closed Thursday above that level at $6.27.

Alpha Natural's 3.75% convertibles due 2017 were not seen in early trade, but they were quoted at 96.5 bid, 97.5 offered versus the $6.27 share price.

Dendreon's convertible bonds were in focus after the Seattle-based biotechnology company announced positive data from a phase 2 study featuring Provenge.

Dendreon's 2.875% convertibles due 2016 weren't heard in early trade. They ended Thursday at about 62.8, according to Trace data, after having traded as high as 66.5 on Monday.

Dendreon also has a 4.75% convertible due in June 2014, which has only $52.5 million outstanding and stands at a little below par.

The Dendreon data is being presented at the 2013 European Cancer Congress in Amsterdam. Preliminary data from a combination study demonstrated that Provenge product potency and immunology are maintained when administered with abiraterone acetate (AA) plus prednisone, according to a news release.

Additionally the preliminary data from an ongoing open-label study showed the long-lived immunological memory to Provenge lasts for years following treatment when patients are retreated.

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