Axos Financial, Inc. (NYSE:AX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.
Following the upgrade, the most recent consensus for Axos Financial from its five analysts is for revenues of US$618m in 2021 which, if met, would be a decent 15% increase on its sales over the past 12 months. Statutory earnings per share are presumed to rise 3.3% to US$3.11. Prior to this update, the analysts had been forecasting revenues of US$561m and earnings per share (EPS) of US$2.56 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 15% to US$30.83 per share. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Axos Financial, with the most bullish analyst valuing it at US$32.00 and the most bearish at US$30.00 per share. This is a very narrow spread of estimates, implying either that Axos Financial is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Axos Financial's past performance and to peers in the same industry. Next year brings more of the same, according to the analysts, with revenue forecast to grow 15%, in line with its 15% annual growth over the past five years. Compare this with the wider industry (in aggregate), which analyst estimates suggest will see revenues fall 6.7% next year. So it's clear that not only is revenue growth expected to be maintained, but Axos Financial is expected to grow meaningfully faster than the wider industry.
The Bottom Line
The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. On the plus side, they also lifted their revenue estimates, and the company is expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Axos Financial.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Axos Financial going out to 2023, and you can see them free on our platform here..
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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