Earnings Beat: Axos Financial, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Axos Financial, Inc. (NYSE:AX) just released its latest quarterly results and things are looking bullish. Statutory earnings performance was extremely strong, with revenue of US$353m beating expectations by 43% and earnings per share (EPS) of US$2.62, an impressive 88%ahead of expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Axos Financial after the latest results.

Check out our latest analysis for Axos Financial

Taking into account the latest results, the most recent consensus for Axos Financial from five analysts is for revenues of US$1.09b in 2024. If met, it would imply a notable 16% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 5.5% to US$7.45. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.01b and earnings per share (EPS) of US$5.68 in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a great increase in earnings per share in particular.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 14% to US$68.67per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Axos Financial analyst has a price target of US$77.00 per share, while the most pessimistic values it at US$62.00. 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. It's clear from the latest estimates that Axos Financial's rate of growth is expected to accelerate meaningfully, with the forecast 35% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 15% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Axos Financial is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Axos Financial following these results. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Axos Financial going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Axos Financial (including 1 which is a bit unpleasant) .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.