Dendreon Corporation (NASDAQ:DNDN) shareholders received the news they’ve been waiting an eternity to hear late last week: a positive opinion on Provenge by the Committee for Medicinal Products for Human Use, or CHMP. While the European Medicines Agency isn’t required to follow the opinion of the CHMP, it often does, giving Provenge a good chance of gaining approval in Europe before the year is out. While it may not seem like much, with competition in the EU over advanced prostate cancer treatments accelerating, this is a big step toward Dendreon Corporation (NASDAQ:DNDN) moving toward a lower cash burn rate, and could, once again, reignite takeover chatter.
If you notice a bit more cash in coffers this week, it’s because we received our quarterly distribution of $0.0575 per share from Xerox Corporation (NYSE:XRX) on Monday. Xerox Corporation (NYSE:XRX) is an extremely sneaky play on the implementation of the Patient Protection and Affordable Care Act, because it processes all of California’s Medicaid claims. Medicaid is set to expand in a big way across the country, bringing some 16-million new members under its umbrella over the next couple of years. Sure, Xerox Corporation (NYSE:XRX) still makes money from its legacy printing and service revenue; but it’s so much more than that now!
Also worth a quick mention, QLogic shares spiked higher on Wednesday after rumors swirled that its peer, Emulex, may have hired an investment bank to seek out strategic alternatives. As a cash-rich and profitable rival to Emulex, it’s not surprising to see buying interest building in QLogic, as well.
We can do better
I might be a bit biased, but I’d call this, perhaps, the best overall week this contrarian portfolio has had since its inception. Of course, a big part of that has to do with the continued surge in Arkansas Best Corporation (NASDAQ:ABFS), but many other components also handily outperformed the S&P 500 for the week. Collectively, this is also the first time the portfolio has sat in positive territory, now up 1.1% since inception. Dividends are starting to play a crucial role in providing supplemental income, but I feel that investors are starting to finally realize and unlock some of the hidden value in these discounted gems.
Check back next week for the latest update on this portfolio and its 10 components.
The article One Person’s Trash Is Another Person’s Treasure Portfolio originally appeared on Fool.com and is written by Sean Williams.
Fool contributor Sean Williams owns shares of QLogic, Dell, Skullcandy, and Orange, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool owns shares of Dendreon, Skullcandy, and Staples. It also recommends Exelon and Orange.
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