Reviewing Alector (NASDAQ:ALEC) and Milestone Pharmaceuticals (NASDAQ:MIST)

Milestone Pharmaceuticals (NASDAQ:MIST) and Alector (NASDAQ:ALEC) are both small-cap medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.

Risk & Volatility

Milestone Pharmaceuticals has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Alector has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500.

Institutional & Insider Ownership

86.2% of Milestone Pharmaceuticals shares are held by institutional investors. Comparatively, 85.8% of Alector shares are held by institutional investors. 19.5% of Milestone Pharmaceuticals shares are held by company insiders. Comparatively, 9.7% of Alector shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Milestone Pharmaceuticals	N/A	-2,374.19%	-85.19%
Alector	-156.03%	-123.02%	-27.48%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Milestone Pharmaceuticals and Alector, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Milestone Pharmaceuticals	1	1	3	1	2.67
Alector	2	4	1	1	2.13

Milestone Pharmaceuticals currently has a consensus target price of $8.00, suggesting a potential upside of 354.55%. Alector has a consensus target price of $3.25, suggesting a potential upside of 65.82%. Given Milestone Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts plainly believe Milestone Pharmaceuticals is more favorable than Alector.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Milestone Pharmaceuticals	$1.00 million	149.90	-$41.52 million	($0.82)	-2.15
Alector	$100.56 million	2.13	-$119.05 million	($1.07)	-1.83

Milestone Pharmaceuticals has higher earnings, but lower revenue than Alector. Milestone 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

Milestone Pharmaceuticals beats Alector on 9 of the 14 factors compared between the two stocks.

About Milestone Pharmaceuticals

Milestone Pharmaceuticals Inc., a biopharmaceutical company, focuses on the development and commercialization of cardiovascular medicines. The company's lead product candidate is etripamil, a novel and potent calcium channel blocker, which is in Phase III clinical trial for the treatment of paroxysmal supraventricular tachycardia in the United States and Canada; and Phase II clinical trial for the treatment of atrial fibrillation and rapid ventricular rate. It has a license and collaboration agreement with Ji Xing Pharmaceuticals to develop and commercialize etripamil prophylactic and therapeutic uses in humans, as well as with the Montreal Heart Institute, the WCN network, and other research centers. The company was incorporated in 2003 and is headquartered in Montréal, Canada.

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.