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Alector
(NASDAQ:ALEC)
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Rating:43Neutral
Price Target:
$2.00
▼(-22.18% Downside)
Action:Reiterated
Date:07/09/26
The score is driven primarily by weak financial performance (large losses, heavy cash burn, and rising leverage from equity erosion). Technicals add limited support as the stock remains below key longer-term moving averages with only neutral momentum. Valuation provides little help due to negative earnings and no dividend, while corporate events add downside risk due to trial failures and the pending end of the GSK partnership despite some liquidity and debt-related positives.
Positive Factors
Strong gross margin
Alector reports a TTM gross margin of roughly 82%, indicating favorable product-level economics for its clinical-stage programs. Durable high gross margins imply that if candidates advance, unit costs are controllable and favorable economics can support scale-up and partner negotiations over months ahead.
Negative Factors
Pipeline setbacks and partner loss
Multiple clinical failures and GSK’s decision to terminate the collaboration constitute a structural hit to Alector’s development engine. Loss of a major partner removes expected milestone and funding streams, increases the burden to self-fund development or re-license assets, and raises execution risk over quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong gross margin
Alector reports a TTM gross margin of roughly 82%, indicating favorable product-level economics for its clinical-stage programs. Durable high gross margins imply that if candidates advance, unit costs are controllable and favorable economics can support scale-up and partner negotiations over months ahead.
Read all positive factors
Alector (ALEC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$203.18M
Dividend YieldN/A
Average Volume (3M)857.82K
Price to Earnings (P/E)―
Beta (1Y)2.13
Revenue Growth-79.15%
EPS Growth5.68%
CountryUS
Employees103
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-1.19
Shares Outstanding111,025,185
10 Day Avg. Volume1,010,411
30 Day Avg. Volume857,816
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 Cap0.64
Enterprise Value/Revenue7.10
Enterprise Value/Gross Profit-1.79
Enterprise Value/Ebitda-1.12
Forecast
1Y Price Target
$2.83Price Target Upside10.25% Upside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)-0.94
Revenue Forecast (FY)$6.98M
Alector Business Overview & Revenue Model
Company Description
Alector, Inc. is a clinical-stage biopharmaceutical company dedicated to pioneering new treatments for neurodegenerative disorders. A key program in its pipeline is AL001, a humanized recombinant monoclonal antibody currently undergoing Phase III ...
How the Company Makes Money
Alector primarily generates revenue from collaboration and licensing arrangements rather than product sales (because it is a clinical-stage company and does not have approved commercial products). Under these arrangements, Alector can earn (i) 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.
Read all updates
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 | -73.09M | 11.38M | -85.38M | 88.21M | 133.62M | 17.68M |
| EBITDA | -116.42M | -133.10M | -110.08M | -116.33M | -121.58M | -28.01M |
| 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
2.00
Negative
2.13
Negative
2.01
Negative
Market Momentum
-0.02
Negative
38.09
Neutral
24.95
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 1.78, above the 50-day MA of 2.00, and above the 200-day MA of 2.01, indicating a bearish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 38.09 is Neutral, neither overbought nor oversold. The STOCH value of 24.95 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% | |
49 Neutral | $1.10B | ― | 87.31% | ― | ― | -1004.74% | |
48 Neutral | $362.26M | -5.14 | 85.78% | ― | 20.08% | 14.06% | |
47 Neutral | $256.47M | -3.18 | -123.98% | ― | -85.87% | -41.37% | |
43 Neutral | $203.18M | -1.37 | -295.17% | ― | -79.15% | 5.68% | |
42 Neutral | $294.60M | -1.24 | -181.70% | ― | ― | 17.61% |
* Healthcare Sector Average
ALEC
Alector
1.64
0.02
1.55%
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Alector Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Alector Ends GSK Collaboration, Retires Hercules Capital Debt
Negative
Jul 8, 2026
On October 21, 2025, Alector reported that its Phase 3 INFRONT-3 trial of latozinemab in frontotemporal dementia patients with progranulin mutations failed to meet its clinical co-primary endpoint. On April 29, 2026, the company further disclosed ...
Executive/Board ChangesShareholder Meetings
Alector Shareholders Back Directors, Auditor and Executive Pay
Positive
Jun 17, 2026
On June 17, 2026, Alector, Inc. held its 2026 annual meeting of stockholders, at which investors elected three Class II directors, Elizabeth Garofalo, M.D., Errol De Souza, Ph.D., and Kristine Yaffe, M.D., to serve until the 2029 annual meeting. T...
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.