Alector, Inc: A stock with its eyes on the future
Alector develops innovative therapeutic approaches for treating neurodegeneration. It is a critical stage biotechnology company.
avatar
Precious Njoku is a Financial Writer with extensive knowledge about the stock market.
2021-12-18 10:11

Everybody needs healthcare. With the Covid-19 pandemic unrelenting and coming up with different variants daily, biotechnology stocks are a good buy right now. As companies unravel new inventions in biotechnology, the outlook is positive. Biopharmaceutical companies like Pfizer (NYSE: PFE) and BioNTech (NASDAQ: BNTX) have stolen the spotlight since the pandemic started. But let us not forget Alector, Inc (NASDAQ: ALEC).

Alector, Inc: A stock with its eyes on the future

Alector develops innovative therapeutic approaches for treating neurodegeneration. It is a critical stage biotechnology company. The company’s pipeline products like AL001, AL002, and AL101 counteract pathologies by restoring the brain’s immune function. As a VC-backed company whose shares are currently a good buy at $21.75, the future outlook is good.

AL001 is a potential treatment for Alzheimer’s disease, Parkinson’s disease, and other forms of neurodegenerative diseases. At the same time, AL002, according to recent reports, which is being developed in collaboration with AbbVie, has shown promise as another treatment for Alzheimer’s disease. Due to their innovative approaches, the company saw a whopping revenue of $182.4 million for 2021, about a 3000% increase in revenue compared to the $5.9 million income for the same period in 2020. AL001 is being developed in collaboration with GlaxoSmithKline Plc (NYSE: GSK) and is currently in clinical trials.

Investors are showing a lot of interest in Biotherapeutics companies. One of Alector’s competitors, Verge Genomics, recently secured $98 million in new funding. In addition, Allergan recently inked an exclusive option to buy Lysosomal Therapeutics, another of Alector’s competitors. Other competitors, Denali and Yumanity, are lucrative stocks.

Alector stocks are bullish both for medium term and long term basis. After the revenue reports in September, analysts delivered a significant upgrade to their forecasts for Alector. Sales for the company are expected to increase next year, and the earnings expectations have also seen an upgrade. Analysts expect its earnings per share (EPS) to go up to $1.90 for 2022 and $4.60 for 2023. They believe the stock will reach a price target of $43.63 by 2022, with further upward growth expected.

Analysts and the market are bullish on Alector’s stock right now because of its recent partnership with GlaxoSmithKline (NYSE: GSK). The collaboration, as earlier highlighted, will develop two monoclonal antibodies that will target various neurodegenerative disorders, and current news from Alector on the clinical trials for the antibodies suggests a positive response. Due to this deal with GSK, Alector’s revenues could reach up to $1.5 billion for the coming year if it meets certain milestones in the rollout of the drugs. This is a “highly positive” development for Alector, and the market welcomed the news enthusiastically.

The bearish news for Alector has to do with the recent shakeups in the Alector’s board and this made the market react negatively to it. As a result, two high-level executives, chief operating officer Shehnaaz Suliman and chief medical officer Robert Paul, will step down from their roles and only serve as advisors until this year. However, the markets continue to believe that this will not translate into a loss of focus.

Alector could be a minor player in the $300 billion biotechnology industry, but recent events indicate that it would continue to grow and carve its mark in the space for treating neurodegenerative diseases like Alzheimer’s and Parkinson’s disease. So right now, Alector stock is a good buy as we anticipate the New Year.


Disclaimer: I have no positions in any of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I have no business relationship with any company whose stock is mentioned in this article. All information should be independently verified and should not be relied upon for purposes of transacting securities or other investments. See terms for more info.

Rate this article

positive
negative
Published On
2021-12-18 10:11

avatar
About the Author
Precious Njoku is a Financial Writer with extensive knowledge about the stock market.


buy-coffee
You've read 1 article in the last year
..thank you for supporting us and for visiting our site. Unlike many other sites, The Dog of Wall Street is available for everyone to read. Our focus is to provide great content for free. Do you like what we are doing? Buy us a cup coffee. It is the fuel that keeps us going..

Elon Musk pulls out of $44 billion Twitter takeover deal
Elon Musk is pulling out of the deal.
By Staff | 1 month ago

Tesla shipped 78,906 China-made cars in June
Almost all production went to Chinese buyers.
By Staff | 1 month ago

Google apparently offered to break off ad company to avoid a lawsuit
Google has proposed to divide its ad-tech division to avoid a second DOJ antitrust case, The Wall Street Journal said Friday.
By Staff | 1 month ago

Spirit postponed a shareholder vote on a Frontier merger for the third time
Investors have more to lose with a Frontier deal, but it may not be over yet.
By Staff | 1 month ago

Chinese court rules USDT stablecoin crypto payments as illegal
On Wednesday, China’s Chaoyang Court upheld the decision that companies cannot pay wages in Tether currency.
By Staff | 1 month ago

Tesla Q2 deliveries fall on shutdown in China
Tesla Production and Deliveries for Q2 of 2022
By Staff | 1 month ago

Dan Ives now has a $40 price target for Rivian
Production numbers are now going in the right direction.
By Staff | 1 month ago