Alector (ALEC) AI Stock Analysis

• Market Cap: $227.73M
• Dividend Yield: N/A
• Average Volume (3M): 1.08M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.21
• Revenue Growth: 46.78%
• EPS Growth: 35.46%
• Country: US
• Employees: 175
• Sector: Healthcare
• Sector Strength: 49
• Industry: Biotechnology
• EPS (TTM): -0.30
• Shares Outstanding: 101,212,326
• 10 Day Avg. Volume: 2,272,960
• 30 Day Avg. Volume: 1,075,280
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: -0.56
• Enterprise Value/Revenue: -1.57
• Enterprise Value/Gross Profit: -4.05
• Enterprise Value/Ebitda: 0.99
• 1Y Price Target: $3.80
• Price Target Upside: 68.89% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 55 Neutral
• Price Target: $2.50 ▲(11.11% Upside)

Alector's overall stock score is primarily impacted by its weak financial performance, characterized by consistent losses and cash flow challenges. While technical analysis shows bullish momentum, the valuation remains unattractive due to a negative P/E ratio. The earnings call provided some positive developments in clinical trials, but regulatory and market challenges persist.

Positive Factors

Efficacy Data

The AL001-treated cohort demonstrated a 48% reduction in the annual progression rate of CDR plus NACC FTLD-SB scores compared to matched GENFI controls, reinforcing the potential efficacy of the treatment.

Financial Stability

$307 million cash will last into the second half of 2027, providing a strong financial runway.

Trial Design

The study is >99% powered for the new co-primary endpoint, and prior open-label data showed normalization of both plasma and CSF PGRN, providing confidence that this endpoint will be met.

Negative Factors

Discontinued Programs

Disappointing INVOKE-2 data for the now-discontinued AL002 in Alzheimer’s disease.

Regulatory Requirements

FDA requested an additional co-primary endpoint in the INFRONT-3 study, reflecting interest in understanding the drug's mechanistic efficacy.

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 treatment of frontotemporal dementia, Alzheimer's, Parkinson's, and amyotrophic lateral sclerosis diseases; and AL101 that is in Phase I clinical trial for the treatment of neurodegenerative diseases, including Alzheimer's and Parkinson's diseases. The company also offers AL002, a product candidate that is in Phase II clinical trial for the treatment of Alzheimer's disease; and AL003, which is in Phase I clinical trial for the treatment of Alzheimer's disease. In addition, its products in development stage include AL044 that targets MS4A4A, a risk gene for Alzheimer's disease. Alector, Inc. has a collaboration agreement with Adimab, LLC for the research and development of antibodies; and a strategic collaboration agreement with GlaxoSmithKline plc for the development and commercialization of monoclonal antibodies, such as AL001 and AL101 to treat neurodegenerative diseases. The company was founded in 2013 and is headquartered in South San Francisco, California.

How the Company Makes Money

Alector generates revenue primarily through the development and commercialization of its therapeutic products. This includes revenue from partnerships and collaborations with pharmaceutical companies, which may involve milestone payments and royalties on product sales. Additionally, the company may receive funding through grants, public and private investments, and potential licensing agreements. The successful advancement of its clinical programs into later stages, as well as the eventual market approval and sales of its therapies, are key contributors to its revenue streams.

Alector Financial Statement Overview

Summary

Alector's financial statements depict a company facing substantial challenges in profitability, revenue growth, and cash flow management. The income statement shows consistent losses and declining revenue, while the balance sheet indicates a high debt-to-equity ratio and negative return on equity. The cash flow statement highlights ongoing cash burn and inefficiencies in cash management.

Income Statement

Alector's income statement reveals consistent losses with declining revenue over recent years. The gross profit margin is volatile, indicating unstable cost management. The net profit margin is negative, reflecting ongoing unprofitability. Revenue growth rate is negative, highlighting shrinking sales. The company struggles with EBIT and EBITDA margins, displaying operating inefficiencies. Overall, Alector's income statement shows significant challenges in achieving profitability and revenue growth.

Balance Sheet

Alector's balance sheet shows a relatively high debt-to-equity ratio, indicating reliance on debt financing. The return on equity is negative due to net losses, signaling challenges in generating shareholder value. The equity ratio is moderate, suggesting a balanced capital structure. However, the diminishing equity over time points to eroding financial strength. While the company maintains a reasonable level of assets, financial stability remains a concern.

Cash Flow

The cash flow statement highlights Alector's negative free cash flow growth rate, reflecting ongoing cash burn without significant improvement. The operating cash flow to net income ratio is negative, indicating insufficient cash generation from core operations. Free cash flow to net income ratio is also negative, underscoring inefficiencies in converting earnings into cash. Alector faces significant challenges in managing cash flows sustainably.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	81.13M	100.56M	97.06M	133.62M	207.09M	21.10M
Gross Profit	31.45M	91.72M	88.21M	133.62M	17.68M	-135.77M
EBITDA	-128.40M	-136.16M	-142.89M	-129.36M	-29.05M	-187.91M
Net Income	-115.29M	-119.05M	-130.39M	-133.31M	-36.33M	-190.23M
Balance Sheet
Total Assets	356.42M	468.30M	621.83M	787.65M	814.66M	488.25M
Cash, Cash Equivalents and Short-Term Investments	307.28M	413.40M	548.86M	712.85M	735.25M	413.31M
Total Debt	39.48M	42.52M	38.92M	43.33M	47.60M	51.26M
Total Liabilities	285.25M	341.50M	487.67M	573.21M	513.93M	220.72M
Stockholders Equity	71.17M	126.80M	134.16M	214.44M	300.72M	267.53M
Cash Flow
Free Cash Flow	-216.01M	-231.16M	-186.54M	-24.45M	295.30M	-171.77M
Operating Cash Flow	-215.59M	-229.91M	-184.16M	-20.33M	298.55M	-166.73M
Investing Cash Flow	203.21M	107.13M	101.92M	-159.01M	-49.66M	-105.05M
Financing Cash Flow	9.91M	81.54M	2.55M	4.51M	30.30M	232.11M

Alector Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.25
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALEC, the sentiment is Positive. The current price of 2.25 is above the 20-day moving average (MA) of 1.82, above the 50-day MA of 1.65, and above the 200-day MA of 1.90, indicating a bullish trend. The MACD of 0.17 indicates Negative momentum. The RSI at 58.76 is Neutral, neither overbought nor oversold. The STOCH value of 79.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALEC.

Alector Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALEC	55 Neutral	$227.73M	―	-103.98%	―	46.78%	35.46%
Sector *	51 Neutral	$7.70B	-0.29	-46.01%	2.24%	23.07%	-0.65%
CHRS	50 Neutral	$122.04M	5.55	-860.65%	―	-53.67%	-330.15%
ENTA	50 Neutral	$171.02M	―	-80.64%	―	-9.94%	20.81%
XBIT	―	$96.04M	―	-15.23%	―	―	―
CCCC	54 Neutral	$175.08M	―	-52.99%	―	16.55%	16.73%
TIL	34 Underperform	$187.94M	―	-51.74%	―	―	29.72%

Alector Corporate Events

Alector Announces CFO Resignation and Interim Appointment

On June 9, 2025, Alector announced the resignation of its Chief Financial Officer, Dr. Marc Grasso, effective June 20, 2025, with Neil Berkley stepping in as Interim CFO. Berkley, who joined Alector in March 2024, brings extensive experience in corporate development and business strategy. Alector also held its annual meeting on June 11, 2025, where stockholders voted on director nominees, ratified Ernst & Young LLP as the accounting firm, and approved executive compensation. The company continues to progress its clinical trials and research programs, with significant developments expected in late 2025.

The most recent analyst rating on (ALEC) stock is a Sell with a $1.50 price target. To see the full list of analyst forecasts on Alector stock, see the ALEC Stock Forecast page.