Core Viewpoint - Investors in Alerus Financial Corporation (ALRS) should closely monitor the stock due to significant implied volatility in the options market, particularly for the Oct 18, 2024 $20 Put option [1] Company Analysis - Alerus Financial is currently rated as Zacks Rank 3 (Hold) within the Financial-Miscellaneous Services industry, which ranks in the top 37% of the Zacks Industry Rank [3] - Over the past 60 days, two analysts have raised their earnings estimates for the current quarter, while no analysts have decreased their estimates, resulting in an increase of the Zacks Consensus Estimate from 41 cents per share to 44 cents per share [3] Options Market Insights - The high implied volatility suggests that options traders are anticipating a significant price movement for Alerus Financial shares, indicating potential trading opportunities [4] - Seasoned options traders often seek out options with high implied volatility to sell premium, aiming to benefit from the decay of the option's value if the underlying stock does not move as much as expected [4]

Financial Data and Key Metrics Changes - The company reported net income of $6.2 million, or $0.31 per share, with pre-provision net revenue (PPNR) improving by 48% on a linked quarter basis [5][24] - Net interest income increased by approximately 8%, with adjusted net interest margin expanding by 13 basis points during the quarter [8][24] - Total fee income rose by 8.1%, contributing over 53% of total revenues [9][24] Business Line Data and Key Metrics Changes - Loans grew by 4.2%, with a loan-to-deposit ratio ending at 88% [7][24] - The retirement business saw total revenue increase by 2.7%, driven by asset-based and non-market-based fees [20] - Wealth management revenues increased by 4%, while assets under management decreased by 1.7% [21] Market Data and Key Metrics Changes - Deposits increased by 0.4% from the prior quarter, with non-interest bearing deposits growing by 1.3% [18][24] - The company experienced seasonal outflows from public funds but managed to drive organic deposit growth to offset these outflows [18][24] Company Strategy and Development Direction - The company is focused on building its commercial wealth bank and diversifying its loan portfolio, with a target loan mix of 30% commercial and industrial (C&I), 30% consumer and residential, and the remainder in commercial real estate [12] - Alerus is progressing with the acquisition of HMN Financial, targeting a closing in the fourth quarter of the year [14][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the credit environment, noting a gradual normalization towards historical levels and proactive measures in credit management [11][66] - The company anticipates continued improvement in net interest margin and strong organic loan growth, positioning itself for sustainable growth and increasing profitability [24][66] Other Important Information - The company raised its dividend by 5.3%, maintaining its status as a dividend aristocrat [13] - The allowance for loan losses remained at 1.31%, consistent with prior quarters [11] Q&A Session Summary Question: Inquiry about the construction credit that migrated - Management indicated that 25% is reserved against the credit, which is 80% complete, and they believe feasible options exist to complete the project [26][27] Question: Clarification on margin outlook - The company expects a few basis points of margin expansion next quarter, with a return to liability sensitivity as swaps roll off [28][30] Question: Equipment finance team integration and growth potential - The equipment finance team is expected to drive growth by leveraging relationships with mid-market companies, aiming for a 30% deposit capture from equipment notes [36][38] Question: Update on the HMN Financial acquisition - Integration is progressing well, with positive feedback from employees and customers, and the company is on track for a fourth-quarter close [55][56] Question: Expectations for charge-off levels - Management noted that charge-offs are expected to normalize, with the current quarter being somewhat idiosyncratic due to specific loans [48][49]

ALERUS INVESTOR PRESENTATION 2Q 2024 NASDAQ: ALRS DISCLAIMERS Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of Alerus Financial Corporation. These statements are often, but not ...

Alerus (ALRS) reported $51.37 million in revenue for the quarter ended June 2024, representing a year-over-year increase of 7%. EPS of $0.31 for the same period compares to $0.45 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $49.2 million, representing a surprise of +4.42%. The company delivered an EPS surprise of -16.22%, with the consensus EPS estimate being $0.37.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expe ...

分组1 - Alerus reported quarterly earnings of $0.31 per share, missing the Zacks Consensus Estimate of $0.37 per share, and down from $0.45 per share a year ago, representing an earnings surprise of -16.22% [1] - The company posted revenues of $51.37 million for the quarter ended June 2024, exceeding the Zacks Consensus Estimate by 4.42%, and up from $48.01 million year-over-year [1] - Over the last four quarters, Alerus has surpassed consensus revenue estimates four times [1] 分组2 - The current consensus EPS estimate for the coming quarter is $0.41 on revenues of $50.55 million, and for the current fiscal year, it is $1.37 on revenues of $209.35 million [4] - Alerus has a Zacks Rank of 3 (Hold), indicating expected performance in line with the market in the near future [4] - The Financial - Miscellaneous Services industry is currently in the top 42% of Zacks industries, suggesting a favorable outlook compared to the bottom 50% [5]

Exhibit 99.1 ◾ Alan A. Villalon, Chief Financial Officer 952.417.3733 (Office) FOR RELEASE (07.24.2024) ALERUS FINANCIAL CORPORATION REPORTS SECOND QUARTER 2024 NET INCOME OF $6.2 MILLION MINNEAPOLIS, MN (July 24, 2024) – Alerus Financial Corporation (Nasdaq: ALRS), or the Company, reported net income of $6.2 million for the second quarter of 2024, or $0.31 per diluted common share, compared to net income of $6.4 million, or $0.32 per diluted common share, for the first quarter of 2024, and net income of $9 ...

Second Quarter Summary Net income of $1.0 million, down $0.4 million, from $1.4 million for second quarter of 2023Diluted earnings per share of $0.22, down $0.10, from $0.32 for second quarter of 2023Net interest income of $7.5 million, down $0.2 million, from $7.7 million for second quarter of 2023Gain on sales of loans of $0.6 million, up $0.3 million, from $0.3 million for second quarter of 2023Net interest margin of 2.70%, down 20 basis points, from 2.90% for second quarter of 2023Goodwill impairment of ...

Core Insights - The article highlights upcoming dividend increases from ten companies, with an average increase of 7.7% and a median of 7.6% [1] - The investment strategy focuses on acquiring companies that consistently raise dividends and outperform benchmarks [1] Group 1: Dividend Increases - The list includes companies with a history of at least five years of consistent dividend growth [2] - The companies featured have a range of dividend increase percentages, with notable increases from Victory Capital Holdings, Inc. at 10.45% and Hawthorn Bancshares, Inc. at 11.76% [7][10] - The ex-dividend dates for these companies are primarily in June 2024, with Travelers Companies, Inc. and CNO Financial Group, Inc. both set for June 10, 2024 [7] Group 2: Company Metrics - The forward yield for the companies ranges from 1.38% for Chubb Limited to 4.15% for Alerus Financial Corporation [7][8] - Current prices for the companies vary, with Travelers Companies, Inc. priced at $208.41 and CNO Financial Group, Inc. at $28.20 [12] - The historical performance of SCHD shows a return of about 181% over the past decade, with NDAQ, CB, and CPK outperforming this benchmark [20] Group 3: Investment Strategy - The investment approach emphasizes identifying stocks that consistently outperform the market while increasing dividends [19] - The analysis includes a focus on companies that have shown strong dividend growth, with NASDAQ being highlighted for its performance [21] - The article suggests a cautious approach to investing in companies that may have had rapid price increases followed by declines, as seen with NASDAQ [21]

Core Viewpoint - Alerus Financial has agreed to acquire HMN Financial in an all-stock deal valued at $116.4 million, marking its 26th acquisition since 2000, with expectations for closure in Q4 2024 [1][2]. Group 1: Acquisition Details - The acquisition will see HMN Financial shareholders receive 1.25 shares of Alerus Financial for each share they own [2]. - HMN Financial, through its subsidiary Home Federal Savings Bank, operates 12 branches in Minnesota and additional branches in Iowa and Wisconsin, with total assets of $1.2 billion as of March 31, 2024 [2]. - Post-acquisition, the combined entity will have nearly $5.5 billion in total assets, $3.7 billion in loans, and $4.3 billion in deposits, operating through 29 locations across the Midwest and Arizona [2]. Group 2: Financial Impact - The transaction is expected to be immediately accretive to Alerus Financial's 2025 earnings by 45%, excluding one-time expenses [3]. - The deal will yield 30% cost savings on HMN Financial's non-interest expenses, with one-time pre-tax charges of $21.7 million anticipated [3]. Group 3: Strategic Implications - This acquisition aligns with Alerus Financial's strategy of combining organic growth with inorganic expansion, diversifying its loan portfolio and enhancing market share in Rochester and other Minnesota markets [4]. - Over the past year, Alerus Financial's shares have increased by 34.7%, outperforming the industry average of 24.4% [4].

Core Viewpoint - Alerus Financial Corporation has signed a definitive Agreement and Plan of Merger to acquire HMN Financial, Inc. in an all-stock transaction valued at approximately $116.4 million, aiming to enhance its business segments and expand its market presence [1][2][4]. Company Overview - Alerus Financial Corporation is a commercial wealth bank and national retirement services provider with corporate offices in Grand Forks, North Dakota, and the Minneapolis-St. Paul, Minnesota metropolitan area [6][7]. - HMN Financial, Inc. is a savings and loan holding company headquartered in Rochester, Minnesota, operating Home Federal Savings Bank with 12 branches in Minnesota and additional locations in Iowa and Wisconsin [8]. Merger Details - The merger will result in HMNF merging with Alerus, and Home Federal merging with Alerus' wholly-owned bank subsidiary, Alerus Financial, National Association [1][2]. - Upon completion, the combined company will have approximately $5.5 billion in total assets, $3.7 billion in total loans, and $4.3 billion in total deposits, with assets under administration and management of approximately $43.1 billion [2]. - Stockholders of HMNF will receive 1.25 shares of Alerus common stock for each share of HMNF common stock they own, with the transaction expected to be immediately accretive to Alerus' estimated earnings [3][4]. Strategic Rationale - The merger is part of Alerus' long-term plan to expand its business segments, including banking, wealth services, and retirement and benefits plans [2]. - Alerus aims to leverage Home Federal's core deposit franchise and client relationships to enhance service offerings and community engagement [3]. Financial Advisors - Raymond James & Associates, Inc. served as financial advisor to Alerus, while D.A. Davidson & Co. served as financial advisor to HMNF [4].