Piper Sandler raises Alerus Financial stock price target to $25.50 on strong Q2

Investing.com - Piper Sandler raised its price target on Alerus Financial Corp . (NASDAQ:ALRS) to $25.50 from $24.00 on Wednesday, while maintaining a Neutral rating following the company’s second-quarter results. According to InvestingPro data, the stock is currently trading at a P/E ratio of 13.8x and has delivered a strong 19.3% return year-to-date.

The financial services company reported second-quarter results that exceeded expectations, with pre-provision net revenue showing an 18% upside driven by stronger net interest income. The performance benefited from greater net interest margin expansion along with higher mortgage and wealth management fee revenue. With a market capitalization of $560 million and impressive revenue growth of 35.7% in the last twelve months, Alerus has demonstrated solid operational execution. Get deeper insights into Alerus’s performance metrics with InvestingPro, which offers comprehensive analysis and additional ProTips.

Credit metrics for Alerus remained essentially stable when adjusted for proactive purchased credit deteriorated (PCD) loan sales. The firm noted that Alerus’ relatively higher non-performing assets should move closer to peers within the next twelve months. The company maintains a strong dividend track record, currently offering a 3.7% yield, and has raised its dividend for 20 consecutive years.

Piper Sandler raised its 2025 operating earnings per share estimate to $2.50, an increase of $0.10, reflecting the second-quarter upside, while maintaining its 2026 estimate at $2.55.

The price target increase to $25.50 represents a 10.0x multiple on the firm’s 2026 earnings estimate, a 0.5x increase due to higher peer multiples, which Piper Sandler indicated is consistent with high fee income peers currently trading at 10.1x.

In other recent news, Alerus Financial Corp reported stronger-than-expected earnings for the second quarter of 2025. The company achieved adjusted earnings per share of $0.72, surpassing the forecast of $0.55. Additionally, Alerus Financial’s revenue exceeded expectations, reaching $74.79 million compared to the projected $69.98 million. Following these results, several analyst firms adjusted their price targets for the company. Raymond (NSE:RYMD) James raised its price target to $27.00, noting an impressive quarter with a wider net interest margin and solid credit metrics. DA Davidson increased its price target to $25.00, highlighting a positive net interest margin surprise that contributed to earnings per share upside. Keefe, Bruyette & Woods also raised their price target to $25.00, citing stronger pre-provision net revenue and lower provisions that helped exceed market expectations. These developments reflect a positive outlook from analysts on Alerus Financial’s recent performance.

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