Axos Financial (NYSE:AX) Releases Earnings Results, Beats Estimates By $0.37 EPS

Axos Financial (NYSE:AX) issued its quarterly earnings results on Thursday. The company reported $2.53 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $2.16 by $0.37, FiscalAI reports. The firm had revenue of $379.77 million during the quarter, compared to analyst estimates of $375.54 million. Axos Financial had a return on equity of 17.31% and a net margin of 22.39%.During the same period last year, the company earned $1.94 EPS.

Here are the key takeaways from Axos Financial’s conference call:

• Strong growth and profitability: Net income rose 12.9% year over year to $124.9 million, while diluted EPS increased 12.5% to $2.16; excluding a $21 million legal accrual, EPS would have risen 28% to $2.46.
• Loan and deposit momentum remains robust: Net loans excluding single-family mortgage warehouse grew by approximately $750 million sequentially, deposits increased 17.9% year over year to $24.6 billion, and management expects low-to-mid-teens organic loan growth over the next year.
• Credit trends improved: Non-performing assets declined to $159 million, net charge-offs fell to 25 basis points, and the allowance for credit losses remained strong at 1.34% of loans, with management expecting reserves of roughly 1.3%-1.4% going forward.
• Margin expected to remain stable, but acquisition-related liquidity may weigh on reported NIM: Management forecast relatively stable net interest margin and deposit costs, while noting that excess deposits from the Capital One acquisition could temporarily sit in cash and reduce reported NIM without affecting net interest income.
• Legal accrual increased expenses: A $21 million accrual related to a legal matter in the clearing business lifted quarterly non-interest expense to $205.9 million and reduced reported fiscal-year pretax income, though management characterized the item as non-recurring.

Axos Financial Stock Up 2.9%

NYSE AX traded up $2.86 during midday trading on Friday, hitting $101.34. 599,091 shares of the company traded hands, compared to its average volume of 333,877. Axos Financial has a 52 week low of $74.89 and a 52 week high of $105.20. The company’s 50-day simple moving average is $93.40 and its 200-day simple moving average is $91.86. The company has a market cap of $5.76 billion, a PE ratio of 11.96 and a beta of 1.23. The company has a debt-to-equity ratio of 0.38, a current ratio of 1.15 and a quick ratio of 1.15.

Insider Buying and Selling at Axos Financial

In related news, Director Roque A. Santi sold 500 shares of the company’s stock in a transaction on Friday, May 8th. The stock was sold at an average price of $87.77, for a total transaction of $43,885.00. Following the completion of the sale, the director directly owned 7,646 shares in the company, valued at $671,089.42. This represents a 6.14% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this link. Also, EVP Michael James Watson sold 1,653 shares of Axos Financial stock in a transaction dated Tuesday, May 19th. The shares were sold at an average price of $83.77, for a total value of $138,471.81. Following the completion of the transaction, the executive vice president owned 4,592 shares in the company, valued at $384,671.84. This trade represents a 26.47% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders own 4.85% of the company’s stock.

Institutional Investors Weigh In On Axos Financial

A number of hedge funds and other institutional investors have recently bought and sold shares of AX. Brown Brothers Harriman & Co. purchased a new stake in Axos Financial during the 3rd quarter valued at about $29,000. Transamerica Financial Advisors LLC lifted its holdings in shares of Axos Financial by 163.7% during the fourth quarter. Transamerica Financial Advisors LLC now owns 443 shares of the company’s stock worth $38,000 after purchasing an additional 275 shares during the period. EverSource Wealth Advisors LLC boosted its position in Axos Financial by 294.7% in the second quarter. EverSource Wealth Advisors LLC now owns 446 shares of the company’s stock valued at $34,000 after buying an additional 333 shares during the last quarter. NewEdge Advisors LLC increased its holdings in Axos Financial by 22.8% in the 4th quarter. NewEdge Advisors LLC now owns 1,105 shares of the company’s stock worth $95,000 after buying an additional 205 shares during the period. Finally, Advisory Services Network LLC acquired a new position in Axos Financial in the 3rd quarter worth approximately $104,000. Hedge funds and other institutional investors own 83.79% of the company’s stock.

Wall Street Analyst Weigh In

A number of analysts have recently issued reports on the stock. Needham & Company LLC boosted their target price on shares of Axos Financial from $110.00 to $128.00 and gave the company a “buy” rating in a research note on Friday. Raymond James Financial raised shares of Axos Financial from an “outperform” rating to a “strong-buy” rating and reduced their price target for the stock from $110.00 to $100.00 in a research note on Tuesday, April 7th. Weiss Ratings raised shares of Axos Financial from a “buy (b-)” rating to a “buy (b)” rating in a research report on Wednesday, July 1st. Benchmark initiated coverage on shares of Axos Financial in a research note on Wednesday, July 8th. They issued a “buy” rating and a $115.00 target price on the stock. Finally, Keefe, Bruyette & Woods raised their target price on shares of Axos Financial from $105.00 to $110.00 and gave the stock a “market perform” rating in a research report on Friday. Two research analysts have rated the stock with a Strong Buy rating, four have issued a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat, the company has an average rating of “Buy” and an average price target of $114.83.

Key Axos Financial News

Here are the key news stories impacting Axos Financial this week:

• Positive Sentiment: Fourth-quarter earnings exceeded expectations. Axos reported adjusted EPS of $2.53, above the approximately $2.15–$2.16 consensus range and up from $1.94 a year earlier. Revenue was $379.77 million, also ahead of the $375.54 million estimate. The company reported $124.9 million in net income and a 22.53% net margin. Axos Financial Beats Q4 Earnings and Revenue Estimates
• Positive Sentiment: Analysts raised their valuation targets. Needham increased its target from $110 to $128 and maintained a “buy” rating, implying substantial potential appreciation from recent trading levels. Keefe, Bruyette & Woods raised its target from $105 to $110 while retaining a “market perform” rating, signaling a more measured but still improved outlook. Needham Raises Axos Financial Price Target
• Positive Sentiment: Management expects continued loan growth. Axos forecast low- to mid-teens loan growth while expecting its net interest margin to remain stable, supporting expectations for further revenue and earnings expansion. Axos Forecasts Loan Growth and Stable Net Interest Margin
• Neutral Sentiment: Arc integration creates a near-term cost headwind. The integration is expected to add roughly $1 million in monthly expenses, which could constrain operating leverage even if loan growth remains strong.

Axos Financial Company Profile

Axos Financial, Inc (NYSE: AX) is a diversified online banking and financial services holding company headquartered in San Diego, California. The firm traces its origins to 1999 with the launch of Bank of Internet USA and rebranded as Axos Financial in December 2018 to reflect an expanded suite of digital offerings. Axos Financial operates through its wholly owned subsidiary, Axos Bank, providing a technology-driven banking platform that serves both retail and commercial clients across the United States.

Through its digital banking platform, Axos Financial delivers a range of deposit products, including checking and savings accounts, money market and certificate of deposit accounts, as well as individual retirement accounts.