Head to Head Analysis: Ionis Pharmaceuticals (NASDAQ:IONS) versus Alector (NASDAQ:ALEC)

Alector (NASDAQ:ALEC) and Ionis Pharmaceuticals (NASDAQ:IONS) are both healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, profitability and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings for Alector and Ionis Pharmaceuticals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alector	2	3	3	0	2.12
Ionis Pharmaceuticals	1	4	17	0	2.73

Alector currently has a consensus price target of $3.62, indicating a potential upside of 100.28%. Ionis Pharmaceuticals has a consensus price target of $89.20, indicating a potential upside of 104.87%. Given Ionis Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts clearly believe Ionis Pharmaceuticals is more favorable than Alector.

Risk and Volatility

Alector has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500. Comparatively, Ionis Pharmaceuticals has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares Alector and Ionis Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alector	-850.13%	-531.03%	-44.00%
Ionis Pharmaceuticals	-64.76%	-111.08%	-17.41%

Insider & Institutional Ownership

85.8% of Alector shares are owned by institutional investors. Comparatively, 93.9% of Ionis Pharmaceuticals shares are owned by institutional investors. 8.3% of Alector shares are owned by company insiders. Comparatively, 1.8% of Ionis Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Alector and Ionis Pharmaceuticals”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alector	$21.05 million	9.60	-$142.93 million	($1.10)	-1.65
Ionis Pharmaceuticals	$874.09 million	8.28	-$381.39 million	($3.46)	-12.58

Alector has higher earnings, but lower revenue than Ionis Pharmaceuticals. Ionis Pharmaceuticals is trading at a lower price-to-earnings ratio than Alector, indicating that it is currently the more affordable of the two stocks.

Summary

Ionis Pharmaceuticals beats Alector on 8 of the 14 factors compared between the two stocks.

About Alector

Alector, Inc., a clinical stage biopharmaceutical company, develops therapies for the treatment of neurodegeneration diseases. Its products include AL001, an immune activity in the brain with genetic links to multiple neurodegenerative disorders, 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. 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.

About Ionis Pharmaceuticals

Ionis Pharmaceuticals, Inc. discovers and develops RNA-targeted therapeutics in the United States. The company offers SPINRAZA for spinal muscular atrophy (SMA) in pediatric and adult patients; TEGSEDI, an antisense injection for the treatment of polyneuropathy caused by hereditary transthyretin amyloidosis in adults; and WAYLIVRA, an antisense medicine for treatment for familial chylomicronemia syndrome (FCS) and familial partial lipodystrophy. It also develops medicines for various indications that are in phase 3 study, including Eplontersen as a monthly self-administered subcutaneous injection to treat all types of ATTR; Olezarsen for patients with FCS and severe hypertriglyceridemia (SHTG); Donidalorsen for patients with hereditary angioedema; ION363 for patients with amyotrophic lateral sclerosis; Tofersen to inhibit the production of superoxide dismutase 1; Pelacarsen for patients with established cardiovascular disease and elevated lipoprotein(a); and Bepirovirsen to inhibit the production of viral proteins associated with hepatitis B virus. In addition, the company develops IONIS-FB-LRx to inhibit the production of complement factor B and the alternative complement pathway; and ION224 to reduce the production of diacylglycerol acyltransferase 2. It has a strategic collaboration with Biogen for the treatment of neurological disorders; and collaboration and license agreement with Metagenomi, Inc, AstraZeneca, Bayer AG, GlaxoSmithKline plc, Novartis, Roche, Swedish Orphan Biovitrum AB, and PTC Therapeutics. The company was incorporated in 1989 and is based in Carlsbad, California.