Axos Financial (NYSE:AX) Issues Quarterly Earnings Results, Beats Expectations By $0.37 EPS

Axos Financial (NYSE:AX) posted its quarterly earnings data on Thursday. The company reported $2.53 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.16 by $0.37, FiscalAI reports. Axos Financial had a return on equity of 16.48% and a net margin of 22.53%.During the same quarter last year, the business earned $1.94 earnings per share.

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 Trading Up 0.3%

Shares of Axos Financial stock traded up $0.32 during trading on Thursday, reaching $98.50. The company’s stock had a trading volume of 406,456 shares, compared to its average volume of 400,790. The company has a quick ratio of 1.15, a current ratio of 1.15 and a debt-to-equity ratio of 0.38. Axos Financial has a 52-week low of $74.89 and a 52-week high of $102.18. The firm’s 50-day moving average is $92.85 and its two-hundred day moving average is $91.74. The company has a market cap of $5.60 billion, a price-to-earnings ratio of 11.97 and a beta of 1.23.

Insiders Place Their Bets

In other news, Director Roque A. Santi sold 500 shares of the firm’s stock in a transaction dated Friday, May 8th. The stock was sold at an average price of $87.77, for a total transaction of $43,885.00. Following the transaction, the director directly owned 7,646 shares of the company’s stock, valued at approximately $671,089.42. This trade represents a 6.14% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, EVP Michael James Watson sold 1,653 shares of the firm’s stock in a transaction that occurred on Tuesday, May 19th. The stock was sold at an average price of $83.77, for a total value of $138,471.81. Following the transaction, the executive vice president owned 4,592 shares in the company, valued at approximately $384,671.84. The trade was a 26.47% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. 4.85% of the stock is owned by company insiders.

Institutional Trading of Axos Financial

A number of institutional investors have recently made changes to their positions in the stock. Corient Private Wealth LLC raised its holdings in Axos Financial by 6.6% during the 4th quarter. Corient Private Wealth LLC now owns 2,696 shares of the company’s stock valued at $232,000 after buying an additional 168 shares during the last quarter. Mercer Global Advisors Inc. ADV grew its holdings in Axos Financial by 7.3% in the 4th quarter. Mercer Global Advisors Inc. ADV now owns 11,697 shares of the company’s stock worth $1,008,000 after acquiring an additional 798 shares during the last quarter. Summit Global Investments increased its position in shares of Axos Financial by 35.7% in the fourth quarter. Summit Global Investments now owns 14,203 shares of the company’s stock valued at $1,224,000 after acquiring an additional 3,734 shares during the period. State of Tennessee Department of Treasury raised its stake in shares of Axos Financial by 29.6% during the fourth quarter. State of Tennessee Department of Treasury now owns 31,196 shares of the company’s stock valued at $2,688,000 after acquiring an additional 7,118 shares during the last quarter. Finally, NewEdge Advisors LLC raised its stake in shares of Axos Financial by 22.8% during the fourth quarter. NewEdge Advisors LLC now owns 1,105 shares of the company’s stock valued at $95,000 after acquiring an additional 205 shares during the last quarter. Hedge funds and other institutional investors own 83.79% of the company’s stock.

Analyst Ratings Changes

AX has been the subject of a number of research analyst reports. Raymond James Financial upgraded Axos Financial from an “outperform” rating to a “strong-buy” rating and dropped their price target for the company from $110.00 to $100.00 in a research report on Tuesday, April 7th. Benchmark began coverage on shares of Axos Financial in a research report on Wednesday, July 8th. They issued a “buy” rating and a $115.00 price objective on the stock. Weiss Ratings raised shares of Axos Financial from a “buy (b-)” rating to a “buy (b)” rating in a research note on Wednesday, July 1st. Finally, Zacks Research lowered shares of Axos Financial from a “strong-buy” rating to a “hold” rating in a research report on Wednesday, April 8th. 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 company. Based on data from MarketBeat.com, the stock has a consensus rating of “Buy” and a consensus price target of $110.33.

About Axos Financial

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.