Head to Head Comparison: Axos Financial (NYSE:AX) vs. Hilltop (NYSE:HTH)

Hilltop (NYSE:HTH) and Axos Financial (NYSE:AX) are both mid-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Institutional & Insider Ownership

57.1% of Hilltop shares are owned by institutional investors. Comparatively, 83.8% of Axos Financial shares are owned by institutional investors. 5.4% of Hilltop shares are owned by insiders. Comparatively, 4.3% of Axos Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Hilltop and Axos Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hilltop	9.08%	6.47%	0.89%
Axos Financial	22.39%	16.96%	1.77%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Hilltop and Axos Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hilltop	1	4	1	0	2.00
Axos Financial	0	2	5	1	2.88

Hilltop currently has a consensus price target of $40.00, suggesting a potential upside of 10.10%. Axos Financial has a consensus price target of $115.67, suggesting a potential upside of 25.72%. Given Axos Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Axos Financial is more favorable than Hilltop.

Volatility & Risk

Hilltop has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500. Comparatively, Axos Financial has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500.

Earnings and Valuation

This table compares Hilltop and Axos Financial”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hilltop	$1.63 billion	1.28	$165.59 million	$2.70	13.46
Axos Financial	$1.46 billion	3.58	$490.37 million	$8.47	10.86

Axos Financial has lower revenue, but higher earnings than Hilltop. Axos Financial is trading at a lower price-to-earnings ratio than Hilltop, indicating that it is currently the more affordable of the two stocks.

Summary

Axos Financial beats Hilltop on 12 of the 15 factors compared between the two stocks.

About Hilltop

Hilltop Holdings Inc. provides business and consumer banking services. It operates through three segments: Banking, Broker-Dealer, and Mortgage Origination. The Banking segment offers savings, checking, interest-bearing checking, and money market accounts; certificates of deposit; lines and letters of credit, home improvement and equity loans, loans for purchasing and carrying securities, term, agricultural and commercial real estate, equipment loans, and other lending products; and mortgage, commercial and industrial loans, and term and construction finance. It also provides treasury management, asset management, check cards, safe deposit boxes, online banking, bill pay, and overdraft privilege services; and estate planning, management and administration, investment portfolio management, employee benefit accounts, and individual retirement accounts services, as well as automated teller machines. The Broker-Dealer segment offers public finance services that assist public entities in originating, syndicating, and distributing securities of municipalities and political subdivisions; specialized advisory and investment banking services; advice and guidance to arbitrage rebate compliance, portfolio management, and local government investment pool administration; advisory services and products for derivatives and commodities; agricultural insurance; and sells, trades in, and underwrites U.S. government and government agency bonds, corporate bonds, and municipal bonds; mortgage-backed, asset-backed, and commercial mortgage-backed securities and structured products; and provides asset and liability management advisory, clearing, retail, and securities lending services. The Mortgage Origination segment offers fixed and adjustable rate mortgages, jumbo, new construction, Federal Housing Administration, Veterans Affairs, and United States Department of Agriculture loans. Hilltop Holdings Inc. was incorporated in 1998 and is based in Dallas, Texas.

About Axos Financial

Axos Financial, Inc., together with its subsidiaries, provides consumer and business banking products in the United States. It operates through two segments, Banking Business and Securities Business. The company offers deposits products, including consumer and business checking, demand, savings, time deposit, money market, zero balance, and insured cash sweep accounts. It also provides residential single family, multifamily, and commercial mortgage loans; commercial real estate secured loans; commercial and industrial non-real estate, asset-backed, lines of credit, and term loans; automobile loans; fixed rate unsecured loans; and other loans, such as structure settlements, small business administration consumer loans, and securities-backed loans. In addition, the company offers ACH origination, wire transfer, commercial check printing, business bill pay and account transfer; remote deposit capture, mobile deposit, lockbox, merchant, and online payment portal; concierge banking; mobile and text message banking; and payment services, as well as debit and credit cards, and digital wallets. Further, it provides disclosed clearing services; back-office services, such as record keeping, trade reporting, accounting, general back-office support, securities and margin lending, reorganization assistance, and custody of securities; and financing to brokerage customers. The company was formerly known as BofI Holding, Inc. and changed its name to Axos Financial, Inc. in September 2018. Axos Financial, Inc. was incorporated in 1999 and is based in Las Vegas, Nevada.