Axos Financial (NYSE:AX) Issues Earnings Results, Misses Expectations By $0.23 EPS

Key Points

• Axos reported $1.90 EPS, missing estimates by $0.23, but revenue of $392.25M beat expectations and the company showed double‑digit year‑over‑year growth with ~17% return on equity.
• Ending loan balances grew roughly $800M linked‑quarter and management is pursuing liquidity and deposit growth via a closing $2.3B Jenius acquisition and an announced $3.2B Capital One IRA/CD purchase while targeting low‑to‑mid‑teens organic loan growth.
• Net interest margin fell to 4.57% (management says organic NIM is roughly flat excluding a ~5 bps deposit premium), while credit stress rose—net charge‑offs hit 31 bps and a ~$20M specific reserve was booked though allowance coverage remains high (~192% of non‑accrual loans).

Axos Financial (NYSE:AX - Get Free Report) announced its quarterly earnings results on Thursday. The company reported $1.90 EPS for the quarter, missing analysts' consensus estimates of $2.13 by ($0.23), FiscalAI reports. Axos Financial had a return on equity of 16.98% and a net margin of 22.66%.The business had revenue of $392.25 million during the quarter, compared to analysts' expectations of $369.36 million. During the same period in the previous year, the business earned $1.81 EPS.

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

• Axos reported broad double‑digit year‑over‑year growth across core metrics — diluted EPS +18.7%, double‑digit growth in net interest income, ending loans and deposits, and >16% return on average common equity.
• Strong loan and funding momentum: ending loan balances grew ~$800M linked quarter (ex. SFR warehouse) with a target of low‑to‑mid‑teens annual organic loan growth, and management is adding liquidity via the $2.3B Jenius deposit acquisition (closing) and a announced $3.2B Capital One IRA/CD deposit purchase.
• Net interest margin declined to 4.57% from 4.94% primarily due to FDIC‑purchased loan prepayments and two fewer days in the quarter, but management expects reported NIM to be roughly flat on an organic basis (excluding an estimated ~5 bps deposit purchase premium).
• Credit stress picked up: net charge‑offs rose to 31 bps (driven by a $14M charge‑off on a C&I loan and a newly delinquent syndicated C&I exposure), provision expense increased to $41M including a ~$20M specific reserve, though allowance coverage remains high (ACL to non‑accrual loans ~192.2%).
• Non‑interest income jumped to $86M helped by Verdant fees, mortgage servicing valuation gains, rental income and a one‑time $22M legal settlement, while AI and operational initiatives are starting to show modest efficiency benefits amid slightly higher non‑interest expense (~$186M).

Axos Financial Stock Up 1.9%

Axos Financial stock traded up $1.79 on Thursday, hitting $96.69. 366,791 shares of the stock traded hands, compared to its average volume of 353,567. The company has a current ratio of 1.08, a quick ratio of 1.08 and a debt-to-equity ratio of 0.40. The firm has a market cap of $5.48 billion, a P/E ratio of 12.26 and a beta of 1.26. The business's fifty day simple moving average is $89.89 and its 200 day simple moving average is $88.01. Axos Financial has a 1 year low of $62.35 and a 1 year high of $101.92.

Wall Street Analyst Weigh In

AX has been the subject of a number of research analyst reports. Zacks Research lowered Axos Financial from a "strong-buy" rating to a "hold" rating in a research note on Wednesday, April 8th. Jefferies Financial Group raised their price target on Axos Financial from $110.00 to $115.00 and gave the stock a "buy" rating in a research note on Friday, January 30th. DA Davidson raised their price target on Axos Financial from $107.50 to $112.00 and gave the stock a "buy" rating in a research note on Friday, January 30th. Weiss Ratings raised Axos Financial from a "buy (b-)" rating to a "buy (b)" rating in a research note on Friday, April 24th. Finally, Raymond James Financial raised Axos Financial from an "outperform" rating to a "strong-buy" rating and dropped their price target for the stock from $110.00 to $100.00 in a research note on Tuesday, April 7th. One research analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and two have given a Hold rating to the company's stock. Based on data from MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $104.50.

Insider Buying and Selling at Axos Financial

In other Axos Financial news, Director James John Court sold 11,163 shares of the firm's stock in a transaction on Friday, February 6th. The stock was sold at an average price of $101.01, for a total transaction of $1,127,574.63. Following the completion of the transaction, the director owned 32,169 shares of the company's stock, valued at approximately $3,249,390.69. This trade represents a 25.76% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through this link. Also, EVP Derrick Walsh sold 4,846 shares of the firm's stock in a transaction on Friday, February 6th. The shares were sold at an average price of $101.21, for a total value of $490,463.66. Following the transaction, the executive vice president directly owned 37,936 shares of the company's stock, valued at $3,839,502.56. This represents a 11.33% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders sold 59,303 shares of company stock valued at $5,908,474. 4.85% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Axos Financial

Institutional investors and hedge funds have recently added to or reduced their stakes in the company. CIBC Bancorp USA Inc. purchased a new position in Axos Financial during the third quarter valued at $491,000. Foyston Gordon & Payne Inc lifted its position in Axos Financial by 8.9% during the fourth quarter. Foyston Gordon & Payne Inc now owns 5,189 shares of the company's stock valued at $447,000 after buying an additional 424 shares during the period. Creative Planning lifted its position in Axos Financial by 10.3% during the third quarter. Creative Planning now owns 4,764 shares of the company's stock valued at $403,000 after buying an additional 446 shares during the period. Abel Hall LLC bought a new position in shares of Axos Financial during the fourth quarter valued at $331,000. Finally, Cibc World Markets Corp bought a new position in shares of Axos Financial during the fourth quarter valued at $310,000. Hedge funds and other institutional investors own 83.79% of the company's stock.

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.

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