Alector, Inc. (NASDAQ:ALEC) Chief Financial Officer Marc Grasso has sold a total of 7,297 shares of the company's common stock, a recent filing with the Securities and Exchange Commission revealed. The transaction, which took place on September 3, 2024, involved shares sold at a weighted average price of $4.8815, amounting to over $35,620 in total.
The shares were disposed of to satisfy the executive's tax obligations related to the vesting of restricted stock units (RSUs), as noted in the footnotes of the filing. The sales occurred in multiple transactions at prices that ranged narrowly from $4.8815 to $4.8816.
Following the sale, Grasso still retains a significant stake in the biotechnology firm, owning 130,740 shares directly. Alector, headquartered in South San Francisco, California, operates in the biological products industry, excluding diagnostic substances.
Investors often monitor insider transactions like these for insights into executive confidence and company performance. The sale by Alector's CFO will likely be of interest to current and potential shareholders, as they assess the stock's value and the company's financial health.
In other recent news, Alector Inc . disclosed its second-quarter results, with no major updates on its pipeline since the previous quarter. Mizuho Securities continues to maintain an Outperform rating for Alector, highlighting the forthcoming release of Phase 2 INVOKE-2 study data for AL002, an early Alzheimer's disease treatment, anticipated in the fourth quarter of 2024. The company's solid financial position, with sufficient cash to fund operations through 2026, was also noted by Mizuho.
Meanwhile, Alector's shareholders elected Louis J. Lavigne, Jr., Richard H. Scheller, Ph.D., and Mark Altmeyer as Class III directors at their 2024 annual meeting. Ernst & Young LLP was ratified as Alector's independent registered accounting firm for the fiscal year ending December 31, 2024, and the company's executive compensation package was approved.
In addition to these governance decisions, Alector is making strides in its neurodegenerative disease research. The company's PROGRESS-AD trial, which involves a SORT-1 activating antibody for Alzheimer's disease, is ongoing. Alector's AL101 therapy is also under evaluation for potential benefits in Alzheimer's disease, with the trial design emphasizing biomarkers and employing MRI scans for monitoring.
Lastly, H.C. Wainwright has adjusted Alector's share price target from $41.00 to $35.00, while maintaining a Buy rating. This adjustment is due to a reassessment of operating expense assumptions, considering the development of AL101, AL002, and the ABC platform. These are among the recent developments for Alector, Inc.
InvestingPro Insights
Alector, Inc. (NASDAQ:ALEC) has been navigating choppy financial waters, as evidenced by recent metrics and analyst insights. Despite the sale of shares by CFO Marc Grasso, investors might be interested in the company's broader financial landscape. Alector's market capitalization currently stands at $448.65 million, reflecting the market's valuation of the company.
An important InvestingPro Tip to consider is that Alector holds more cash than debt on its balance sheet, which could provide some financial flexibility in the short term. However, it's worth noting that the company is quickly burning through cash, which raises concerns about its long-term financial sustainability. Additionally, four analysts have revised their earnings forecasts downwards for the upcoming period, suggesting that the market may need to recalibrate its expectations for Alector's financial performance.
From a profitability standpoint, Alector's price-to-earnings (P/E) ratio sits at a negative -2.56, with an adjusted P/E ratio for the last twelve months as of Q2 2024 at -2.76. This indicates that the company is not currently generating net income, a trend that is expected to continue with net income projected to drop this year. Furthermore, analysts do not anticipate the company to be profitable within the year, aligning with the negative gross profit margin of -246.51% for the last twelve months as of Q2 2024. This margin reflects the challenges Alector faces in converting revenue into gross profit.
For those considering an investment in Alector, it's worth exploring the additional 10 InvestingPro Tips available on the platform, which could provide deeper insights into the company's financial health and stock potential. The InvestingPro product offers a comprehensive analysis that could be invaluable in making an informed investment decision.
Finally, Alector's stock has taken a significant hit over the last week, with a price total return of -9.4%. This could be a reflection of broader market sentiment or specific concerns about the company's performance and outlook. With the next earnings date on November 12, 2024, investors will be keenly watching for signs of a turnaround or further indications of financial headwinds.
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