Alector, Inc., a clinical stage biotechnology company, focuses on developing therapies that harness the immune system to cure neurodegenerative diseases.
The last earnings update was 26 days ago.
Discounted Cash Flow Calculation for DB:0Z2 using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
DB:0Z2 DCF 1st Stage: Next 10 year cash flow forecast
Amount off the current price
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
Alector's share price is below the future cash flow value, and at a moderate discount (> 20%).
Alector's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
is considered below, and whether this is a fair price.
Price based on past earnings
Alector's earnings available for a low price, and how does
this compare to other companies in the same industry?
Alector is not considered high growth as it is expected to be loss making for the next 1-3 years.
Alector's revenue is expected to grow significantly at over 20% yearly.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Alector's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
has a total score of
0/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Dr. Arnon Rosenthal, Ph.D., co-founded of Alector LLC in 2013 and serves as its Chief Executive Officer, President and Director since 2013. He served a Chief Scientific Officer of Alector LLC. Dr. Rosenthal co-founded Annexon Biosciences, Inc. and served as its acting Chief Executive Officer from August 2011 to December 2014 and served as a member of the board of directors, including as Chairman from August 2011 February 2017. He co-founded Rinat Neuroscience Corporation (acquired by Pfizer Inc. in August 2006) in October 2001 and served as President, Chief Scientific Officer and as a member of the board of directors from August 2001 to August 2006. From January 1985 to August 2001, Dr. Rosenthal served in various roles at Genentech, Inc., where he ultimately served as Staff Scientist and was appointed as a permanent member of Genentech’s Research Review Committee where his team discovered the target for the cancer drug Erivedge. Dr. Rosenthal conducted his post-doctoral fellowship at Genentech, Inc. Dr. Rosenthal is a Visiting Professor of the Department of Anatomy at the University of California San Francisco and a Member of the Scientific Advisory Board of Simons Foundation, Autism Research Initiative and the Myelin Repair Foundation. He is a Member of the NIH Advisory Committee on Parkinson's Disease and Neuronal Repair. He is a Leader in the field of neurological disease, publishing over 70 articles on the topic. Dr. Rosenthal holds a Ph.D. in biology from the Hebrew University of Jerusalem.
Arnon's compensation has increased whilst company is loss making.
Arnon's remuneration is higher than average for companies of similar size in Germany.
Management Team Tenure
Average tenure and age of the
management team in years:
The tenure for the Alector management team is about average.
Co-Founder & Chairman
Chief Medical Officer
Chief Development Officer
Vice President of Finance
Vice President of Legal
Chief Business Officer
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the Alector board of directors is about average.
Alector, Inc., a clinical stage biotechnology company, focuses on developing therapies that harness the immune system to cure neurodegenerative diseases. Its products in Phase I clinical trial include AL001, a humanized recombinant monoclonal antibody for the treatment of frontotemporal dementia; and AL002 for the treatment of Alzheimer’s disease. The company’s preclinical stage products comprise AL101 for the treatment of multiple neurodegenerative disorders; and AL003 for the treatment of Alzheimer’s disease. It also has 10 programs under research and development stage. The company was founded in 2013 and is headquartered in South San Francisco, California.
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