Is Axos Financial's (AX) Focus on Efficiency Hiding Deeper Shifts in Its Business Model?

• Axos Financial announced its quarterly earnings for the first quarter ended September 30, 2025, reporting net interest income of US$291.05 million and net income of US$112.35 million, both nearly unchanged from the prior year, with diluted earnings per share at US$1.94.
• An interesting aspect is Axos Financial's ongoing commitment to operational efficiency and technology use, highlighted by its stable margins and disciplined expense management, even as it completed its previously announced share buyback program during the quarter.
• We’ll explore how Axos Financial’s stable net interest margins and improved loan quality influence its investment narrative moving forward.

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Axos Financial Investment Narrative Recap

To be a shareholder in Axos Financial, you need to believe in its ability to leverage a digital-first banking model and disciplined cost control to drive consistent earnings, even as competition intensifies and interest margins are pressured. The latest quarterly report showed stable net interest income and earnings, which leaves the company’s most important near-term catalyst, expanding its digital deposit base, largely unchanged, while the main risk remains further compression in net interest margins; the news does not materially alter these factors.

The company’s announcement of completing its share buyback program, repurchasing 853,609 shares for US$51.93 million, stands out as the most relevant recent event. This move reflects Axos Financial’s ongoing approach to capital management, which ties into analyst commentary about prudent capital deployment being a potential catalyst for shareholder returns, even as pressure on interest spreads persists across the industry.

Yet, investors should consider that, despite these strengths, heightened competition and persistent pricing pressure can impact Axos Financial’s margins...

Read the full narrative on Axos Financial (it's free!)

Axos Financial is projected to reach $1.5 billion in revenue and $544.2 million in earnings by 2028. This outlook assumes annual revenue growth of 8.4% and an earnings increase of $111.3 million from the current earnings of $432.9 million.

Uncover how Axos Financial's forecasts yield a $100.50 fair value, a 23% upside to its current price.

Exploring Other Perspectives

Three fair value estimates from the Simply Wall St Community range from US$100.50 to over US$201,000, showing broad disagreement on Axos Financial’s outlook. Amid this, ongoing margin pressure underscores why opinions and outcomes diverge so sharply, see how others are viewing the risks and opportunities.

Explore 3 other fair value estimates on Axos Financial - why the stock might be a potential multi-bagger!

Build Your Own Axos Financial Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Axos Financial research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Axos Financial research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Axos Financial's overall financial health at a glance.

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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.

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