Alerus Financial (ALRS) AI Stock Analysis

• Market Cap: $613.34M
• Dividend Yield: 3.71%
• Average Volume (3M): 86.42K
• Price to Earnings (P/E): 11.6
• Beta (1Y): 0.92
• Revenue Growth: 42.22%
• EPS Growth: 1207.84%
• Country: US
• Employees: 846
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.66
• Shares Outstanding: 25,397,303
• 10 Day Avg. Volume: 80,477
• 30 Day Avg. Volume: 86,419
• PEG Ratio: 0.54
• Price to Book (P/B): 0.82
• Price to Sales (P/S): 1.23
• P/FCF Ratio: 24.41
• Enterprise Value/Market Cap: 1.41
• Enterprise Value/Revenue: 2.21
• Enterprise Value/Gross Profit: 3.23
• Enterprise Value/Ebitda: 9.99
• 1Y Price Target: $25.00
• Price Target Upside: 5.00% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: $24.50 ▲(2.90% Upside)

The score is driven primarily by solid financial performance (steady growth, improved profitability, and stronger cash generation) and supportive valuation (low P/E and strong yield). Offsetting this are mixed technical signals that suggest only modest momentum, while guidance and recent actions are constructive but balanced by credit-quality and fee-income headwinds plus a one-time loss from the portfolio repositioning.

Positive Factors

Revenue Growth

Steady revenue growth and improved margins indicate strong market demand and efficient operations, supporting long-term business sustainability.

Cash Generation

Significant improvement in cash generation enhances financial flexibility, enabling strategic investments and shareholder returns.

Strategic Portfolio Repositioning

Portfolio restructuring to higher yields is expected to boost margins, supporting earnings growth and capital strength long-term.

Negative Factors

Nonperforming Assets

Rising nonperforming assets could signal credit quality issues, potentially impacting profitability and risk management.

Fee Income Decline

Declining fee income may affect revenue diversification and profitability, posing challenges to maintaining stable earnings.

Operational Efficiency Pressure

Decreased operational efficiency could hinder profitability improvements, requiring management focus on cost control and process optimization.

Alerus Financial Business Overview & Revenue Model

Company Description

Alerus Financial Corporation, through its subsidiary, Alerus Financial, National Association, provides various financial services to businesses and consumers. The company operates in four segments: Banking, Retirement and Benefit Services, Wealth Management, and Mortgage. It offers various deposit products, including demand deposits, interest-bearing transaction accounts, money market accounts, time and savings deposits, checking accounts, and certificates of deposit; and treasury management products, including electronic receivables management, remote deposit capture, cash vault services, merchant services, and other cash management services. The company also provides commercial loans, business term loans, lines of credit, and commercial real estate loans, as well as construction and land development loans; consumer lending products, including residential first mortgage loans; installment loans and lines of credit; and second mortgage loans. In addition, it offers retirement plan administration and investment advisory services, employee stock ownership plan, fiduciary services, payroll, health savings accounts, and other benefit services, as well as individual retirement accounts; and financial planning, investment management, personal and corporate trust, estate administration, and custody services. Further, the company provides debit and credit cards, online banking, mobile banking/wallet, payment, private banking, payroll accounts, flex spending accounts, administration, and government health insurance program services. It offers banking services through fourteen offices in North Dakota, Minnesota, and Arizona; and retirement and benefit plans in 50 states through offices located in Michigan, Minnesota, and Colorado. The company was formerly known as First National Bank North Dakota and changed its name to Alerus Financial Corporation in 2000. Alerus Financial Corporation was founded in 1879 and is headquartered in Grand Forks, North Dakota.

How the Company Makes Money

Alerus makes money through several key revenue streams, including interest income from loans and mortgages, fees from banking services, wealth management fees, and commissions from insurance products. The company earns interest income primarily from its loan portfolio, which includes commercial, consumer, and residential mortgages. Additionally, Alerus generates non-interest income through service fees for account maintenance, transaction processing, and financial advisory services. Strategic partnerships with other financial institutions and service providers further enhance its offerings and contribute to revenue growth, while a focus on customer retention and satisfaction helps maintain a steady client base.

Alerus Financial Financial Statement Overview

Summary

Alerus Financial demonstrates a strong financial position with consistent revenue growth and improved profitability margins. The balance sheet is stable with a manageable level of debt, though there is potential for better equity utilization. Cash flow generation has improved significantly, indicating strong cash management. Overall, the company is on a positive trajectory with solid financial health, though there are areas for potential improvement in operational efficiency and equity utilization.

Income Statement

Alerus Financial shows a solid performance in its income statement with a consistent revenue growth rate of 5.14% in the TTM period. The gross profit margin is strong at 62.45%, and the net profit margin has improved to 15.99%, indicating enhanced profitability. However, the EBIT and EBITDA margins have decreased compared to previous years, suggesting some pressure on operational efficiency.

Balance Sheet

The balance sheet reflects a moderate debt-to-equity ratio of 0.54, showing a manageable level of leverage. The return on equity is 9.63%, which is a positive sign of profitability, though it has decreased from previous years. The equity ratio stands at 10.33%, indicating a stable capital structure. Overall, the balance sheet is stable but shows some room for improvement in equity utilization.

Cash Flow

Cash flow analysis reveals a significant improvement in free cash flow growth at 64.33% in the TTM period, which is a positive indicator of cash generation. The operating cash flow to net income ratio is 0.30, suggesting a reasonable conversion of income to cash. However, the free cash flow to net income ratio of 0.92 indicates that most of the net income is being converted into free cash flow, which is a positive aspect.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	392.24M	330.41M	243.16M	224.58M	235.79M	239.77M
Gross Profit	268.44M	197.73M	164.06M	208.77M	233.74M	216.61M
EBITDA	86.78M	38.04M	24.36M	60.42M	77.89M	67.44M
Net Income	50.42M	17.74M	11.70M	40.01M	52.68M	44.67M
Balance Sheet
Total Assets	5.33B	5.26B	3.91B	3.78B	3.39B	3.01B
Cash, Cash Equivalents and Short-Term Investments	92.04M	649.29M	616.63M	775.57M	1.10B	765.30M
Total Debt	296.07M	317.02M	378.88M	442.82M	63.21M	66.60M
Total Liabilities	4.78B	4.77B	3.54B	3.42B	3.03B	2.68B
Stockholders Equity	550.69M	495.41M	369.13M	356.87M	359.40M	330.16M
Cash Flow
Free Cash Flow	55.67M	16.59M	25.71M	101.18M	148.13M	-26.06M
Operating Cash Flow	60.71M	28.96M	28.98M	102.97M	149.83M	-22.25M
Investing Cash Flow	-99.32M	-330.03M	-51.99M	-292.62M	-417.66M	-538.39M
Financing Cash Flow	64.68M	232.42M	94.76M	5.59M	337.18M	589.60M

Alerus Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 23.81
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 23.81 is above the 20-day moving average (MA) of 22.75, above the 50-day MA of 21.89, and above the 200-day MA of 20.94, indicating a bullish trend. The MACD of 0.35 indicates Negative momentum. The RSI at 68.63 is Neutral, neither overbought nor oversold. The STOCH value of 78.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALRS.

Alerus Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SHBI	78 Outperform	$597.00M	10.48	10.25%	2.66%	6.01%	38.05%
ALRS	70 Outperform	$613.34M	11.64	11.37%	3.71%	42.22%	1207.84%
HIFS	69 Neutral	$602.99M	13.47	10.23%	0.84%	8.26%	94.53%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
WASH	57 Neutral	$568.00M	-18.48	-4.73%	7.17%	-27.82%	-159.63%
MOFG	56 Neutral	$808.04M	13.94	10.01%	2.46%	89.00%	―

Alerus Financial Corporate Events

Alerus Financial Restructures Securities Portfolio To Boost Margins

On December 23, 2025, Alerus Financial Corporation sold $360 million of available-for-sale securities—more than 68% of its AFS portfolio—with a weighted average yield of 1.7% and duration of 5.1 years, realizing a one-time pre-tax net loss of $68.5 million. The company immediately reinvested the proceeds into higher-yielding securities averaging 4.7% with a shorter duration of just over three years, a move expected to lift its 2026 net interest margin above prior guidance while keeping risk-based capital ratios above regulatory and internal thresholds. Management framed the transaction as the culmination of a 2025 deleveraging and balance sheet strengthening strategy that avoided dilutive equity issuance, preserves tangible capital, and is intended to position Alerus for improved earnings, tangible book value growth, and enhanced long-term value for clients, communities, and shareholders.

The most recent analyst rating on (ALRS) stock is a Buy with a $25.00 price target. To see the full list of analyst forecasts on Alerus Financial stock, see the ALRS Stock Forecast page.

Alerus Financial Announces 5% Dividend Increase

On December 5, 2025, Alerus Financial Corporation announced a 5% increase in its regular quarterly cash dividend, now set at $0.21 per common share, payable on January 9, 2026, to shareholders recorded by December 26, 2025. This decision reflects the company’s commitment to providing value to its shareholders and may enhance its attractiveness in the financial market.

The most recent analyst rating on (ALRS) stock is a Hold with a $23.00 price target. To see the full list of analyst forecasts on Alerus Financial stock, see the ALRS Stock Forecast page.

Alerus Financial Reports Q3 2025 Earnings

On October 30, 2025, Alerus Financial Corporation reported a net income of $16.9 million for the third quarter of 2025, a decrease from $20.3 million in the previous quarter but an increase from $5.2 million in the same quarter of 2024. The company achieved a record net interest income of $43.1 million and maintained a strong return on average total assets. Alerus continues to see growth in loans, deposits, and assets under management, driven by strategic acquisitions and enhancements in its commercial wealth bank. The company’s focus on disciplined execution and client expansion aims to deliver superior returns and shareholder value despite potential economic uncertainties.

The most recent analyst rating on (ALRS) stock is a Buy with a $24.00 price target. To see the full list of analyst forecasts on Alerus Financial stock, see the ALRS Stock Forecast page.