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

Axos Financial (NYSE:AX) posted its earnings results on Thursday, July 30th. The company reported $2.53 earnings per share for the quarter, beating the consensus estimate 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 net margin of 22.39% and a return on equity of 16.96%. During the same period in the previous year, the firm 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 Price Performance

Shares of AX opened at $99.13 on Tuesday. The company has a debt-to-equity ratio of 0.24, a current ratio of 1.04 and a quick ratio of 1.04. Axos Financial has a 12 month low of $74.89 and a 12 month high of $105.74. The stock has a fifty day moving average price of $95.24 and a 200 day moving average price of $92.24. The company has a market cap of $5.64 billion, a P/E ratio of 11.70 and a beta of 1.22.

Analyst Ratings Changes

Several equities research analysts recently commented on the stock. DA Davidson set a $121.00 price target on shares of Axos Financial in a report on Friday, July 31st. Needham & Company LLC upped their target price on shares of Axos Financial from $110.00 to $128.00 and gave the company a “buy” rating in a research report on Friday, July 31st. Keefe, Bruyette & Woods upped 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 note on Friday, July 31st. 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 price target on the stock. Finally, Weiss Ratings raised Axos Financial from a “buy (b-)” rating to a “buy (b)” rating in a report on Wednesday, July 1st. Two analysts have rated the stock with a Strong Buy rating, four have issued a Buy rating and two have given a Hold rating to the company’s stock. According to data from MarketBeat.com, Axos Financial presently has an average rating of “Buy” and a consensus target price of $114.83.

Insider Buying and Selling at Axos Financial

In other news, EVP Michael James Watson sold 1,653 shares of the company’s stock in a transaction on Tuesday, May 19th. The stock was sold at an average price of $83.77, for a total transaction of $138,471.81. Following the completion of the sale, the executive vice president directly owned 4,592 shares of the company’s stock, valued at $384,671.84. This represents a 26.47% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. Also, Director Roque A. Santi sold 500 shares of the firm’s stock in a transaction dated Wednesday, August 5th. The stock was sold at an average price of $105.30, for a total value of $52,650.00. Following the sale, the director owned 7,146 shares of the company’s stock, valued at $752,473.80. The trade was a 6.54% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Corporate insiders own 4.85% of the company’s stock.

Hedge Funds Weigh In On Axos Financial

Several institutional investors have recently bought and sold shares of AX. Cetera Investment Advisers increased its stake in shares of Axos Financial by 0.7% in the 4th quarter. Cetera Investment Advisers now owns 16,547 shares of the company’s stock valued at $1,426,000 after buying an additional 108 shares during the period. Police & Firemen s Retirement System of New Jersey grew its stake in Axos Financial by 0.9% in the fourth quarter. Police & Firemen s Retirement System of New Jersey now owns 14,871 shares of the company’s stock valued at $1,281,000 after acquiring an additional 132 shares during the period. Federation des caisses Desjardins du Quebec grew its stake in Axos Financial by 0.8% in the fourth quarter. Federation des caisses Desjardins du Quebec now owns 17,663 shares of the company’s stock valued at $1,522,000 after acquiring an additional 146 shares during the period. Lido Advisors LLC grew its stake in Axos Financial by 2.5% in the fourth quarter. Lido Advisors LLC now owns 6,150 shares of the company’s stock valued at $522,000 after acquiring an additional 150 shares during the period. Finally, Commonwealth Equity Services LLC boosted its position in shares of Axos Financial by 0.6% during the fourth quarter. Commonwealth Equity Services LLC now owns 25,723 shares of the company’s stock worth $2,216,000 after buying an additional 161 shares during the period. Institutional investors own 83.79% of the company’s stock.

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.