Alector (ALEC)
NASDAQ:ALEC
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Alector
(NASDAQ:ALEC)
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Rating:42Neutral
Price Target:
$2.00
▼(-22.18% Downside)
Action:Reiterated
Date:05/09/26
The score is primarily held down by weak financial performance—steep losses, heavy cash burn, and a sharply reduced equity cushion that raises financing risk. Technical indicators are also soft (price below key short-term averages, low RSI), while valuation is difficult to support given negative earnings. The new ATM program adds liquidity optionality but increases potential dilution risk.
Positive Factors
High gross margins
Alector's TTM gross margin (~82%) indicates strong product-level economics for its antibody programs. Durable high gross margins mean successful candidates could scale with favorable unit economics, giving margin leverage if operating spend is restructured or revenue rises from partnerships.
Negative Factors
Sustained negative cash flow
Persistent large cash outflows (TTM operating and free cash flow ≈ -$173M) show the company depends on external financing to fund operations and trials. Over months this elevates dilution and execution risk if access to capital tightens, constraining long-term program continuity and strategic optionality.
Read all positive and negative factors
Positive Factors
Negative Factors
High gross margins
Alector's TTM gross margin (~82%) indicates strong product-level economics for its antibody programs. Durable high gross margins mean successful candidates could scale with favorable unit economics, giving margin leverage if operating spend is restructured or revenue rises from partnerships.
Read all positive factors
Alector (ALEC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$245.37M
Dividend YieldN/A
Average Volume (3M)552.70K
Price to Earnings (P/E)―
Beta (1Y)2.00
Revenue Growth-79.15%
EPS Growth5.68%
CountryUS
Employees175
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-1.19
Shares Outstanding111,025,185
10 Day Avg. Volume702,603
30 Day Avg. Volume552,702
Financial Highlights & Ratios
PEG Ratio-0.09
Price to Book (P/B)5.24
Price to Sales (P/S)7.63
P/FCF Ratio-0.87
Enterprise Value/Market Cap0.80
Enterprise Value/Revenue10.66
Enterprise Value/Gross Profit12.02
Enterprise Value/Ebitda-1.57
Forecast
1Y Price Target
$3.63Price Target Upside41.05% Upside
Rating ConsensusHold
Number of Analyst Covering8
EPS Forecast (FY)-0.94
Revenue Forecast (FY)$6.98M
Alector Business Overview & Revenue Model
Company Description
Alector, Inc., a clinical stage biopharmaceutical company, develops therapies for the treatment of neurodegeneration diseases. Its products include AL001, a humanized recombinant monoclonal antibody, which is in Phase III clinical trial for the tr...
How the Company Makes Money
Alector primarily generates revenue through collaboration and licensing arrangements rather than product sales, as it is a clinical-stage company and does not have commercialized therapies. These arrangements typically produce revenue from (1) upf...
Alector Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Neutral
The earnings call presented several positive developments, including strong financial health, upcoming trial data, and completion of enrollment for a key program. However, significant challenges remain, such as regulatory hurdles and the complexity of diagnosing and treating FTD. The balance of promising advancements and existing challenges suggests a cautiously optimistic outlook.Positive Updates
Upcoming INFRONT-3 Trial Data
Alector is anticipating top-line data from their Phase III INFRONT-3 trial of latozinemab by mid-Q4 2025. This trial is pivotal as it targets frontotemporal dementia due to the GRN gene mutation, a rare form of dementia with no approved therapy.
Negative Updates
Regulatory Challenges
The FDA requested a change in the statistical analysis plan for the INFRONT-3 trial to include progranulin as a co-primary endpoint, which requires statistical significance on both co-primary endpoints for the study to be positive.
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Q2-2025 Updates
Positive
Negative
Upcoming INFRONT-3 Trial Data
Alector is anticipating top-line data from their Phase III INFRONT-3 trial of latozinemab by mid-Q4 2025. This trial is pivotal as it targets frontotemporal dementia due to the GRN gene mutation, a rare form of dementia with no approved therapy.
Read all positive updates
Company Guidance
During the Alector Second Quarter and Midyear 2025 Earnings Conference Call, the company provided guidance on several key metrics. They reported a strong cash position of $307.3 million, which is expected to fund operations into the second half of 2027. For fiscal year 2025, Alector anticipates collaboration revenue to be between $13 million and $18 million, with total research and development expenses projected at $130 million to $140 million. General and administrative expenses are forecasted to range from $55 million to $65 million. The company is focused on advancing its late-stage clinical programs, particularly the Phase III INFRONT-3 trial for latozinemab, with pivotal data expected by mid-fourth quarter. They are also progressing the Phase II trial of AL101 for early Alzheimer's disease, with trial completion expected in 2026. Alector highlighted their proprietary technology platform, which supports their preclinical pipeline, including a brain-penetrant anti-amyloid beta antibody for Alzheimer's and an engineered GCase enzyme replacement therapy for Parkinson's disease.Alector Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
22
Negative
Cash Flow
15
Very Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 18.42M | 21.05M | 100.56M | 97.06M | 133.62M | 207.09M |
| Gross Profit | 16.33M | 11.38M | 100.56M | 88.21M | 133.62M | 17.68M |
| EBITDA | -124.79M | -133.10M | -136.16M | -142.89M | -129.36M | -29.05M |
| Net Income | -125.39M | -142.93M | -119.05M | -130.39M | -133.31M | -36.33M |
Balance Sheet | ||||||
| Total Assets | 239.92M | 293.24M | 468.30M | 621.83M | 787.65M | 814.66M |
| Cash, Cash Equivalents and Short-Term Investments | 206.51M | 256.02M | 413.40M | 548.86M | 712.85M | 735.25M |
| Total Debt | 34.55M | 36.23M | 42.52M | 38.92M | 43.33M | 47.60M |
| Total Liabilities | 229.53M | 262.59M | 341.50M | 487.67M | 573.21M | 513.93M |
| Stockholders Equity | 10.38M | 30.65M | 126.80M | 134.16M | 214.44M | 300.72M |
Cash Flow | ||||||
| Free Cash Flow | -173.20M | -184.07M | -231.16M | -186.54M | -24.45M | 295.30M |
| Operating Cash Flow | -173.06M | -184.03M | -229.91M | -184.16M | -20.33M | 298.55M |
| Investing Cash Flow | 191.81M | 196.60M | 107.13M | 101.92M | -159.01M | -49.66M |
| Financing Cash Flow | 20.24M | 20.21M | 81.54M | 2.55M | 4.51M | 30.30M |
Alector Technical Analysis
Negative
2.57
Price Trends
2.30
Negative
2.15
Positive
2.12
Positive
Market Momentum
-0.05
Positive
44.22
Neutral
50.24
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALEC, the sentiment is Negative. The current price of 2.57 is above the 20-day moving average (MA) of 2.25, above the 50-day MA of 2.30, and above the 200-day MA of 2.12, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 44.22 is Neutral, neither overbought nor oversold. The STOCH value of 50.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALEC.
Alector Risk Analysis
Alector disclosed 79 risk factors in its most recent earnings report. Alector reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alector Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
50 Neutral | $840.96M | >-0.01 | 87.31% | ― | ― | -1004.74% | |
49 Neutral | $298.20M | -3.21 | -123.98% | ― | -85.87% | -41.37% | |
49 Neutral | $344.63M | -1.52 | -181.70% | ― | ― | 17.61% | |
46 Neutral | $250.71M | -3.94 | 85.78% | ― | 20.08% | 14.06% | |
42 Neutral | $245.37M | -1.90 | -295.17% | ― | -79.15% | 5.68% |
* Healthcare Sector Average
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Alector Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Alector Establishes $125 Million At-the-Market Offering
Positive
May 8, 2026
On May 7, 2026, Alector, Inc. entered into a sales agreement with TD Securities (USA) LLC, allowing the company to sell up to $125 million of common stock from time to time through at-the-market or negotiated offerings. The program, conducted unde...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.