Alector (ALEC) has received a new Sell rating, initiated by Morgan Stanley analyst, Sean Laaman.
Sean Laaman has given his Sell rating due to a combination of factors influencing Alector’s stock performance. One primary reason is the limited commercial prospects for Alector’s lead drug candidate, latozinemab, despite its potential in treating FTD-GRN. While the drug shows promise due to the high penetrance of PGRN mutations leading to FTD-GRN, translating this success to Alzheimer’s disease with AL101 remains uncertain due to the complexity and multiple risk factors associated with Alzheimer’s.
Additionally, Laaman highlights the lack of significant catalysts for Alector until the fourth quarter of 2025, which could coincide with a precarious financial position for the company, potentially having less than a year of cash reserves. This financial uncertainty, coupled with the speculative nature of the drug’s success in broader applications, contributes to the cautious outlook and the Underweight rating with a price target of $1.50.
Based on the recent corporate insider activity of 32 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of ALEC in relation to earlier this year.