Allete Inc (ALE) Stock Fundamental Analysis

USA • New York Stock Exchange • NYSE:ALE • US0185223007

67.9 USD
-0.04 (-0.06%)
At close: Dec 12, 2025
67.99 USD
+0.09 (+0.13%)
After Hours: 12/12/2025, 8:13:42 PM
Fundamental Rating

3

ALE gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 46 industry peers in the Electric Utilities industry. Both the profitability and financial health of ALE have multiple concerns. ALE is valued expensive and it does not seem to be growing. Finally ALE also has an excellent dividend rating.


Dividend Valuation Growth Profitability Health

3

1. Profitability

1.1 Basic Checks

  • In the past year ALE was profitable.
  • In the past year ALE had a positive cash flow from operations.
  • In the past 5 years ALE has always been profitable.
  • Each year in the past 5 years ALE had a positive operating cash flow.
ALE Yearly Net Income VS EBIT VS OCF VS FCFALE Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M -200M 400M -400M

1.2 Ratios

  • ALE has a worse Return On Assets (2.32%) than 79.17% of its industry peers.
  • The Return On Equity of ALE (5.81%) is worse than 85.42% of its industry peers.
  • The Return On Invested Capital of ALE (1.88%) is worse than 89.58% of its industry peers.
  • ALE had an Average Return On Invested Capital over the past 3 years of 2.33%. This is below the industry average of 4.57%.
Industry RankSector Rank
ROA 2.32%
ROE 5.81%
ROIC 1.88%
ROA(3y)3.04%
ROA(5y)2.9%
ROE(3y)7.37%
ROE(5y)7.27%
ROIC(3y)2.33%
ROIC(5y)2.36%
ALE Yearly ROA, ROE, ROICALE Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2 4 6 8

1.3 Margins

  • ALE's Profit Margin of 11.04% is on the low side compared to the rest of the industry. ALE is outperformed by 66.67% of its industry peers.
  • In the last couple of years the Profit Margin of ALE has declined.
  • ALE has a worse Operating Margin (9.24%) than 85.42% of its industry peers.
  • In the last couple of years the Operating Margin of ALE has declined.
  • Looking at the Gross Margin, with a value of 93.25%, ALE belongs to the top of the industry, outperforming 97.92% of the companies in the same industry.
  • In the last couple of years the Gross Margin of ALE has remained more or less at the same level.
Industry RankSector Rank
OM 9.24%
PM (TTM) 11.04%
GM 93.25%
OM growth 3Y-0.62%
OM growth 5Y-6.31%
PM growth 3Y-0.57%
PM growth 5Y-4.77%
GM growth 3Y-1.28%
GM growth 5Y-0.42%
ALE Yearly Profit, Operating, Gross MarginsALE Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 20 40 60 80

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3

2. Health

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ALE is destroying value.
  • ALE has more shares outstanding than it did 1 year ago.
  • ALE has more shares outstanding than it did 5 years ago.
  • Compared to 1 year ago, ALE has an improved debt to assets ratio.
ALE Yearly Shares OutstandingALE Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M 40M 50M
ALE Yearly Total Debt VS Total AssetsALE Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B

2.2 Solvency

  • ALE has an Altman-Z score of 1.04. This is a bad value and indicates that ALE is not financially healthy and even has some risk of bankruptcy.
  • Looking at the Altman-Z score, with a value of 1.04, ALE is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
  • A Debt/Equity ratio of 0.74 indicates that ALE is somewhat dependend on debt financing.
  • With a decent Debt to Equity ratio value of 0.74, ALE is doing good in the industry, outperforming 70.83% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.74
Debt/FCF N/A
Altman-Z 1.04
ROIC/WACC0.26
WACC7.24%
ALE Yearly LT Debt VS Equity VS FCFALE Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B 2B

2.3 Liquidity

  • ALE has a Current Ratio of 1.17. This is a normal value and indicates that ALE is financially healthy and should not expect problems in meeting its short term obligations.
  • ALE has a better Current ratio (1.17) than 83.33% of its industry peers.
  • ALE has a Quick Ratio of 1.17. This is a bad value and indicates that ALE is not financially healthy enough and could expect problems in meeting its short term obligations.
  • ALE has a Quick ratio of 0.73. This is comparable to the rest of the industry: ALE outperforms 56.25% of its industry peers.
Industry RankSector Rank
Current Ratio 1.17
Quick Ratio 0.73
ALE Yearly Current Assets VS Current LiabilitesALE Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M

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3

3. Growth

3.1 Past

  • The earnings per share for ALE have decreased by -8.65% in the last year.
  • Measured over the past years, ALE shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.89% on average per year.
  • Looking at the last year, ALE shows a decrease in Revenue. The Revenue has decreased by -4.30% in the last year.
  • ALE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.28% yearly.
EPS 1Y (TTM)-8.65%
EPS 3Y-1.36%
EPS 5Y-2.89%
EPS Q2Q%-41.03%
Revenue 1Y (TTM)-4.3%
Revenue growth 3Y2.53%
Revenue growth 5Y4.28%
Sales Q2Q%-7.91%

3.2 Future

  • Based on estimates for the next years, ALE will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.96% on average per year.
  • Based on estimates for the next years, ALE will show a small growth in Revenue. The Revenue will grow by 5.14% on average per year.
EPS Next Y18.92%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
EPS Next 5Y11.96%
Revenue Next Year-1.51%
Revenue Next 2Y2%
Revenue Next 3Y3.82%
Revenue Next 5Y5.14%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
  • The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
ALE Yearly Revenue VS EstimatesALE Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 500M 1B 1.5B 2B
ALE Yearly EPS VS EstimatesALE Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 1 2 3 4 5

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2

4. Valuation

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 23.82, the valuation of ALE can be described as rather expensive.
  • Based on the Price/Earnings ratio, ALE is valued more expensive than 81.25% of the companies in the same industry.
  • ALE is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.32, which is the current average of the S&P500 Index.
  • Based on the Price/Forward Earnings ratio of 16.85, the valuation of ALE can be described as correct.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of ALE is on the same level as its industry peers.
  • ALE is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 23.82
Fwd PE 16.85
ALE Price Earnings VS Forward Price EarningsALE Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, ALE is valued a bit more expensive than the industry average as 77.08% of the companies are valued more cheaply.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 14.18
ALE Per share dataALE EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20 30 40

4.3 Compensation for Growth

  • ALE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • A more expensive valuation may be justified as ALE's earnings are expected to grow with 15.10% in the coming years.
PEG (NY)1.26
PEG (5Y)N/A
EPS Next 2Y14.02%
EPS Next 3Y15.1%

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8

5. Dividend

5.1 Amount

  • With a Yearly Dividend Yield of 4.30%, ALE is a good candidate for dividend investing.
  • Compared to an average industry Dividend Yield of 2.90, ALE pays a better dividend. On top of this ALE pays more dividend than 87.50% of the companies listed in the same industry.
  • ALE's Dividend Yield is rather good when compared to the S&P500 average which is at 1.83.
Industry RankSector Rank
Dividend Yield 4.3%

5.2 History

  • The dividend of ALE has a limited annual growth rate of 3.68%.
  • ALE has been paying a dividend for at least 10 years, so it has a reliable track record.
  • ALE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.68%
Div Incr Years14
Div Non Decr Years19
ALE Yearly Dividends per shareALE Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.5 1 1.5 2 2.5

5.3 Sustainability

  • 101.27% of the earnings are spent on dividend by ALE. This is not a sustainable payout ratio.
  • The dividend of ALE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP101.27%
EPS Next 2Y14.02%
EPS Next 3Y15.1%
ALE Yearly Income VS Free CF VS DividendALE Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M -200M -400M
ALE Dividend Payout.ALE Dividend Payout, showing the Payout Ratio.ALE Dividend Payout.PayoutRetained Earnings

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Allete Inc / ALE FAQ

What is the fundamental rating for ALE stock?

ChartMill assigns a fundamental rating of 3 / 10 to ALE.


Can you provide the valuation status for Allete Inc?

ChartMill assigns a valuation rating of 2 / 10 to Allete Inc (ALE). This can be considered as Overvalued.


What is the profitability of ALE stock?

Allete Inc (ALE) has a profitability rating of 3 / 10.


What are the PE and PB ratios of Allete Inc (ALE) stock?

The Price/Earnings (PE) ratio for Allete Inc (ALE) is 23.82 and the Price/Book (PB) ratio is 1.38.


What is the earnings growth outlook for Allete Inc?

The Earnings per Share (EPS) of Allete Inc (ALE) is expected to grow by 18.92% in the next year.