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Alerus Financial
(NASDAQ:ALRS)
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Rating:63Neutral
Price Target:
$34.00
▲(2.81% Upside)
Action:Reiterated
Date:10/29/26
The score is driven primarily by improving financial performance (revenue rebound, better margins, stronger recent cash generation) and a constructive, guidance-backed earnings call highlighting growth and improving credit quality. The main offsets are a relatively high P/E valuation and only neutral-to-mild technical setup with some near-term pullback risk signals.
Positive Factors
Diversified recurring fee revenue
A substantial fee-based contribution reduces reliance on lending spreads and provides a broader earnings foundation. Retirement revenue is largely tied to plans, participants and activity, while wealth growth and operating leverage can support recurring revenue expansion over the next several quarters.
Negative Factors
Funding-cost and margin pressure
Core banking profitability remains exposed to repricing pressure because deposit costs are rising while purchase-accounting benefits run off. If funding costs increase faster than loan yields, net interest margin and earnings growth could weaken even as loan balances continue expanding.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified recurring fee revenue
A substantial fee-based contribution reduces reliance on lending spreads and provides a broader earnings foundation. Retirement revenue is largely tied to plans, participants and activity, while wealth growth and operating leverage can support recurring revenue expansion over the next several quarters.
Read all positive factors
Alerus Financial (ALRS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$804.41M
Dividend Yield2.67%
Average Volume (3M)172.65K
Price to Earnings (P/E)28.1
Beta (1Y)0.90
Revenue Growth-11.76%
EPS Growth-35.46%
CountryUS
Employees843
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.10
Shares Outstanding24,927,526
10 Day Avg. Volume124,045
30 Day Avg. Volume172,646
Financial Highlights & Ratios
PEG Ratio-1.83
Price to Book (P/B)1.01
Price to Sales (P/S)1.74
P/FCF Ratio9.72
Enterprise Value/Market Cap1.43
Enterprise Value/Revenue3.45
Enterprise Value/Gross Profit4.79
Enterprise Value/Ebitda21.54
Forecast
1Y Price Target
$35.33Price Target Upside6.84% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)3.02
Revenue Forecast (FY)$311.08M
Alerus Financial Business Overview & Revenue Model
Company Description
Alerus Financial Corporation, operating primarily through its subsidiary Alerus Financial, National Association, delivers a broad spectrum of financial services to both commercial clients and individual consumers. The company organizes its operati...
How the Company Makes Money
Alerus Financial makes money primarily through a combination of (1) bank net interest income and (2) fee-based revenues from wealth management and retirement/benefit services. Net interest income is earned by taking deposits and other funding sour...
Alerus Financial Earnings Call Summary
Earnings Call Date:Oct 28, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jan 27, 2027
Earnings Call Sentiment Positive
The call was strongly positive overall. Management reported record revenue, double-digit earnings and fee-income growth, strong commercial loan and relationship-deposit growth, improving credit quality, solid capital and liquidity, and continued shareholder returns. The main challenges were sequential net interest income and reported margin declines, rising funding costs, expected purchase-accounting runoff, mortgage-market weakness, higher expenses and potential credit charges tied to a small number of workout loans.Positive Updates
Record Revenue and Strong Profitability
Total revenue was $81 million, the highest level in Alerus's nearly 150-year history. Reported diluted EPS was $0.76, up 17% year-over-year, while adjusted diluted EPS was $0.71, up 8%. Return on average tangible common equity was 17.35%, return on average assets was 1.45%, and adjusted pre-provision net revenue increased 17% year-over-year.
Negative Updates
Sequential Decline in Net Interest Income and Reported Margin
Net interest income declined $1 million, or 2.1%, from the second quarter to $46.7 million. Reported net interest margin decreased 13 basis points from the second quarter to 3.84%, primarily because the prior quarter included a $1.6 million one-time interest income recovery and higher purchase accounting accretion.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Revenue and Strong Profitability
Total revenue was $81 million, the highest level in Alerus's nearly 150-year history. Reported diluted EPS was $0.76, up 17% year-over-year, while adjusted diluted EPS was $0.71, up 8%. Return on average tangible common equity was 17.35%, return on average assets was 1.45%, and adjusted pre-provision net revenue increased 17% year-over-year.
Read all positive updates
Company Guidance
For full year 2026, Alerus expects mid-single-digit loan growth, low single-digit deposit growth, reported net interest margin of 3.75% to 3.85%, adjusted revenue and adjusted noninterest income to grow in the mid-single digits, adjusted noninterest expense to increase low to mid-single digits, and full year adjusted return on assets to be above 1.25%; swap fee income remains excluded from this guidance. The company expects approximately $1.8 million of base contractual purchase accounting accretion in the fourth quarter, approximately $13 million for ’26 in total and about $9 million in total for ’27, and a little over $300 million of loan turnover per quarter. Retirement revenue should be pretty steady, assuming a neutral market, wealth is not expected to have a big bump in the fourth quarter, and mortgage activity is expected to see a typical seasonal slowdown, with potentially a little bit more weakness; new loan growth will likely be in the 1.15% range, the deposit beta is expected to be 50%, roughly about just a little under $2 billion of loans are repricing over the next 12 months at around 6%, and charge-offs are expected to be lower in the fourth quarter and early in the year next year than historical before moving towards that in the second half.Alerus Financial Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
58
Neutral
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 332.73M | 327.86M | 338.29M | 243.26M | 224.58M | 235.79M |
| Gross Profit | 239.72M | 220.16M | 205.61M | 164.16M | 208.77M | 233.74M |
| EBITDA | 53.34M | 39.88M | 38.04M | 24.36M | 60.42M | 77.89M |
| Net Income | 27.71M | 17.44M | 17.78M | 11.70M | 40.01M | 52.68M |
Balance Sheet | ||||||
| Total Assets | 5.29B | 5.23B | 5.26B | 3.91B | 3.78B | 3.39B |
| Cash, Cash Equivalents and Short-Term Investments | 109.01M | 68.95M | 652.60M | 616.63M | 775.57M | 1.10B |
| Total Debt | 446.99M | 440.55M | 317.02M | 378.88M | 442.82M | 63.21M |
| Total Liabilities | 4.71B | 4.67B | 4.77B | 3.54B | 3.42B | 3.03B |
| Stockholders Equity | 583.14M | 564.93M | 495.41M | 369.13M | 356.87M | 359.40M |
Cash Flow | ||||||
| Free Cash Flow | 99.67M | 58.83M | 16.59M | 25.71M | 101.18M | 148.13M |
| Operating Cash Flow | 95.54M | 67.53M | 28.96M | 28.98M | 102.97M | 149.83M |
| Investing Cash Flow | 83.04M | 76.55M | -330.03M | -51.99M | -292.62M | -417.66M |
| Financing Cash Flow | -150.47M | -138.13M | 232.42M | 94.76M | 5.59M | 337.18M |
Alerus Financial Technical Analysis
Positive
33.07
Price Trends
32.23
Positive
31.87
Positive
28.39
Positive
Market Momentum
>-0.01
Negative
55.16
Neutral
85.15
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALRS, the sentiment is Positive. The current price of 33.07 is above the 20-day moving average (MA) of 31.71, above the 50-day MA of 32.23, and above the 200-day MA of 28.39, indicating a bullish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 55.16 is Neutral, neither overbought nor oversold. The STOCH value of 85.15 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALRS.
Alerus Financial Risk Analysis
Alerus Financial disclosed 76 risk factors in its most recent earnings report. Alerus Financial reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alerus Financial Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $836.79M | 9.47 | 15.71% | 0.32% | ― | ― | |
74 Outperform | $818.50M | 13.50 | 8.72% | 0.43% | 11.16% | 75.53% | |
71 Outperform | $819.60M | 10.73 | 10.24% | 2.98% | 2.87% | 4.63% | |
70 Outperform | $742.89M | 11.63 | 11.25% | 1.19% | -2.89% | 10.50% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
63 Neutral | $804.41M | 28.06 | 5.22% | 2.67% | -11.76% | -35.46% | |
63 Neutral | $791.83M | 10.61 | 12.91% | 1.42% | 3.10% | 24.24% |
* Financial Sector Average
ALRS
Alerus Financial
32.27
11.74
57.15%
PGC
Peapack-Gladstone Financial
46.17
20.81
82.09%
SMBC
Southern Missouri Bancorp
72.02
19.89
38.16%
HTB
Hometrust Bancshares
46.97
7.43
18.79%
IBCP
Independent Bank
36.92
6.89
22.93%
RCBC
River City Bank
58.93
19.30
48.72%
Alerus Financial Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
Alerus Financial Posts Strong Q3 2026 Earnings Performance
Positive
Oct 28, 2026
On October 28, 2026, Alerus Financial reported third-quarter 2026 net income of $19.2 million, or $0.76 per diluted share, down from $20.9 million in the second quarter but above the $16.9 million earned a year earlier. The quarter featured solid ...
Stock BuybackDividends
Alerus Financial Raises Dividend and Expands Buyback Program
Positive
Aug 27, 2026
On August 27, 2026, Alerus Financial Corporation announced that its board had declared a regular quarterly cash dividend of $0.22 per common share, approved on August 26, 2026 and representing a 4.76% increase over the dividend paid a year earlier...
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
Alerus Financial Posts Solid Second-Quarter 2026 Results
Positive
Jul 29, 2026
On July 29, 2026, Alerus Financial Corporation reported second-quarter 2026 net income of $20.9 million, or $0.81 per diluted common share, down from $23.0 million in the first quarter but slightly above the $20.3 million earned a year earlier. Ma...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.