Alaris Royalty (TSE:AD.UN)
TSX:AD.UN
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Alaris Royalty
(TSX:AD.UN)
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Rating:60Neutral
Price Target:
C$22.50
▲(0.27% Upside)
Action:ReiteratedDate:04/08/26
The score is held back primarily by weak cash-flow quality in 2025 (sharp negative operating/free cash flow despite positive net income) and volatility in results. Technicals are moderately supportive with the stock trading above key moving averages, and the high dividend yield helps, but a negative P/E limits valuation confidence.
Positive Factors
Recurring royalty business model
Alaris's contracts generate recurring, often revenue-linked royalty payments that create a predictable cash flow profile versus transactional lending. This durable cash stream, derived from a large invested capital base and contractual rights, supports long-term distributions and underwriting of new royalty deals.
Negative Factors
Deteriorated cash generation in 2025
A sharp swing to negative operating and free cash flow in 2025 is a structural red flag for earnings quality and liquidity. Contractual royalties should produce cash; the mismatch undermines distribution sustainability, may force reliance on external financing, and reduces investment flexibility over coming months.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring royalty business model
Alaris's contracts generate recurring, often revenue-linked royalty payments that create a predictable cash flow profile versus transactional lending. This durable cash stream, derived from a large invested capital base and contractual rights, supports long-term distributions and underwriting of new royalty deals.
Read all positive factors
Alaris Royalty (AD.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.02B
Dividend Yield6.43%
Average Volume (3M)72.61K
Price to Earnings (P/E)10.3
Beta (1Y)0.96
Revenue Growth-19.46%
EPS Growth-61.14%
CountryCA
Employees25
SectorFinancial
Sector Strength70
IndustryAsset Management - Income
Share Statistics
EPS (TTM)>-0.01
Shares Outstanding45,338,810
10 Day Avg. Volume76,803
30 Day Avg. Volume72,608
Financial Highlights & Ratios
PEG Ratio-0.17
Price to Book (P/B)0.83
Price to Sales (P/S)4.20
P/FCF Ratio-7.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$25.75Price Target Upside14.75% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)2.04
Revenue Forecast (FY)C$211.66M
Alaris Royalty Business Overview & Revenue Model
Company Description
Alaris Equity Partners Income Trust is a private equity firm specializing in management buyouts, growth capital, lower & middle market, later stage, industry consolidation, growth capital, and mature investments. The firm does not invest in turnar...
How the Company Makes Money
Alaris makes money primarily by investing capital into private companies and receiving contractually defined royalty payments in return. These royalties are typically structured as recurring payments (often tied to a measure such as the partner co...
Alaris Royalty Earnings Call Summary
Earnings Call Date:Nov 05, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The earnings call highlighted a record-setting quarter for Alaris, with robust revenue growth, strong capital deployment, and positive developments in key portfolio companies like Edgewater. However, challenges such as decreased net distributable cash flow, issues with GWM, and impacts from the U.S. government shutdown on FMP provided some negative aspects. Despite these challenges, the overall performance and outlook remain strong.Positive Updates
Record Quarter Performance
Alaris delivered a record quarter in Q3 2025 with net book value per unit increasing by 6% from last quarter to $25.10, marking a record high. Total revenue and operating income rose 7.8% compared to Q3 2024, supported by a $47.9 million net unrealized fair value gain across 9 investments.
Negative Updates
Decrease in Net Distributable Cash Flow
Alaris' net distributable cash flow decreased by 26% in Q3 and 14% year-to-date, primarily due to variability in common distributions, timing of cash tax payments, and transaction costs.
Read all updates
Q3-2025 Updates
Positive
Negative
Record Quarter Performance
Alaris delivered a record quarter in Q3 2025 with net book value per unit increasing by 6% from last quarter to $25.10, marking a record high. Total revenue and operating income rose 7.8% compared to Q3 2024, supported by a $47.9 million net unrealized fair value gain across 9 investments.
Read all positive updates
Company Guidance
During the Alaris Q3 2025 Earnings Release Conference, several key financial metrics were highlighted, reflecting a strong performance for the quarter. Alaris reported a record net book value per unit increase of 6% from the previous quarter, reaching $25.10, driven by $1.90 per unit of earnings and comprehensive income. The company saw a 7.8% increase in total revenue and operating income compared to Q3 2024, supported by a $47.9 million net unrealized fair value gain across nine investments. Partner revenue exceeded guidance at $58.1 million, with a $57.4 million contribution from distributions. Preferred distributions rose by 7.3% in the quarter and 6% year-to-date, totaling $40.7 million and $120.8 million, respectively. Despite a 26% decrease in net distributable cash flow for Q3, Alaris maintained a low payout ratio of 48%, well below its target range of 65% to 70%, providing flexibility for reinvestment. The company deployed $32.2 million in the quarter, including significant investments in McCoy and Carey, and anticipated Q4 partner revenue of approximately $43.5 million. Looking ahead, Alaris plans to continue leveraging its unique business model to capitalize on deployment opportunities and expects to see further growth in book value through potential exits and new investments.Alaris Royalty Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
78
Positive
Cash Flow
38
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 222.63M | 154.99M | 241.25M | 227.99M | 157.59M |
| Gross Profit | 193.43M | 154.99M | 179.08M | 227.99M | 157.59M |
| EBITDA | 186.23M | 240.59M | 202.66M | 183.36M | 191.24M |
| Net Income | 90.81M | 234.41M | 138.45M | 130.68M | 144.24M |
Balance Sheet | |||||
| Total Assets | 1.42B | 1.20B | 1.47B | 1.37B | 1.28B |
| Cash, Cash Equivalents and Short-Term Investments | 6.38M | 4.20M | 15.18M | 60.19M | 18.45M |
| Total Debt | 263.74M | 64.64M | 403.39M | 372.49M | 416.66M |
| Total Liabilities | 296.83M | 97.72M | 514.07M | 471.85M | 486.35M |
| Stockholders Equity | 1.12B | 1.10B | 960.82M | 898.25M | 788.86M |
Cash Flow | |||||
| Free Cash Flow | -124.71M | 59.37M | 82.96M | 152.42M | -15.44M |
| Operating Cash Flow | -124.71M | 59.37M | 82.96M | 152.42M | 104.16M |
| Investing Cash Flow | 0.00 | 0.00 | -98.32M | 14.85M | -228.99M |
| Financing Cash Flow | 126.94M | -62.12M | -29.91M | -125.16M | 128.47M |
Alaris Royalty Technical Analysis
Positive
22.44
Price Trends
21.32
Positive
20.86
Positive
19.45
Positive
Market Momentum
0.47
Negative
66.72
Neutral
79.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:AD.UN, the sentiment is Positive. The current price of 22.44 is above the 20-day moving average (MA) of 21.30, above the 50-day MA of 21.32, and above the 200-day MA of 19.45, indicating a bullish trend. The MACD of 0.47 indicates Negative momentum. The RSI at 66.72 is Neutral, neither overbought nor oversold. The STOCH value of 79.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:AD.UN.
Alaris Royalty Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | C$1.02B | 2.39 | 5.72% | 0.14% | -57.36% | -41.04% | |
71 Outperform | C$751.64M | 31.59 | 18.00% | 1.51% | 18.31% | ― | |
69 Neutral | C$1.04B | 18.29 | 9.72% | 3.01% | 4.44% | 18.34% | |
69 Neutral | C$1.03B | 11.86 | 11.93% | 7.33% | 6.90% | -8.82% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
60 Neutral | C$1.02B | 10.30 | 8.17% | 6.43% | -19.46% | -61.14% |
* Financial Sector Average
TSE:AD.UN
Alaris Royalty
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4.30
23.48%
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Alaris Royalty Corporate Events
Business Operations and StrategyDividendsPrivate Placements and Financing
Alaris Invests $75.3 Million in Kubik and Lifts Distribution 3%
Positive
Apr 2, 2026
Alaris Equity Partners has invested $75.3 million in Kubik LP, a Toronto-based designer and fabricator of custom trade show exhibits and immersive brand environments serving Fortune 500 clients worldwide. The deal combines $62.5 million in debt an...
Business Operations and StrategyDividends
Alaris Equity Partners Declares First-Quarter 2026 Distribution
Positive
Mar 19, 2026
Alaris Equity Partners Income Trust has declared a first-quarter 2026 distribution of $0.37 per trust unit, equivalent to $1.48 on an annualized basis, payable on April 15 to unitholders of record as of March 31. The announcement underscores the t...
Business Operations and StrategyFinancial Disclosures
Alaris Equity Partners Sets March 9 Release for 2025 Year-End Results
Positive
Mar 3, 2026
Alaris Equity Partners Income Trust will release its year-end financial results for the period ended December 31, 2025, after markets close on March 9, 2026, with management hosting a conference call the following morning to discuss performance an...
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.