On July 30, 2024, Axos Financial Inc (AX, Financial) released its 8-K filing for the fourth fiscal quarter ended June 30, 2024. The company reported a net income of $104.9 million, marking a 20.1% increase from the same period last year. Diluted earnings per share (EPS) were $1.80, matching the analyst estimate of $1.80. Revenue for the quarter was $290.92 million, slightly below the estimated $300.15 million.
Company Overview
Axos Financial Inc is a bank holding company operating through its subsidiary, BofI Federal Bank. The bank provides financing for residential properties, small to medium-sized businesses, and specialty finance receivables. Axos operates in two segments: banking and securities business, distributing its products through various retail channels. The majority of its mortgage exposure is in Southern California. Net interest income constitutes the bulk of the bank's revenue.
Performance and Challenges
Axos Financial Inc's performance in Q4 2024 was marked by a significant increase in net income and EPS. The company reported net income of $104.9 million, up from $87.4 million in Q4 2023. Diluted EPS increased by 23.3% to $1.80 from $1.46 in the same period last year. However, non-interest income saw a decline of 5.6%, primarily due to lower broker-dealer fee income and prepayment penalty fee income.
Financial Achievements
Axos Financial Inc achieved several financial milestones in Q4 2024. Net interest income rose by 27.6% to $260.06 million, driven by higher average balances and rates earned on loans. The net interest margin expanded to 4.65% from 4.19% in Q4 2023. The company's efficiency ratio improved to 43.6%, indicating a highly efficient and profitable operation.
Key Financial Metrics
| Metric | Q4 2024 | Q4 2023 | % Change |
|---|---|---|---|
| Net Interest Income | $260.06 million | $203.75 million | 27.6% |
| Non-Interest Income | $30.86 million | $32.71 million | -5.6% |
| Net Income | $104.87 million | $87.36 million | 20.1% |
| Diluted EPS | $1.80 | $1.46 | 23.3% |
Income Statement Highlights
For the fiscal year ended June 30, 2024, Axos Financial Inc reported a net income of $450.0 million, a 46.5% increase from $307.2 million in the previous fiscal year. Diluted EPS for the fiscal year was $7.66, up 51.1% from $5.07 in the prior year. The company's net interest margin for the banking segment increased to 4.68%, and the efficiency ratio improved to 43.59% from 49.54%.
Balance Sheet Summary
Axos Financial Inc's total assets increased by 12.3% to $22.9 billion as of June 30, 2024. Total liabilities rose by 11.6% to $20.6 billion, primarily due to an increase in deposits. Stockholders' equity increased by 19.5% to $2.3 billion, driven by strong net income and share repurchases.
Commentary
"We had an exceptional fiscal year 2024, with 51% EPS growth, 27 basis point of net interest margin expansion, and a 24% increase in book value per share," stated Greg Garrabrants, President and Chief Executive Officer of Axos.
Analysis
Axos Financial Inc's strong performance in Q4 2024 and the fiscal year highlights its robust financial health and operational efficiency. The significant increase in net interest income and net interest margin indicates effective management of interest-earning assets and liabilities. However, the decline in non-interest income suggests potential challenges in diversifying revenue streams. Overall, Axos Financial Inc's financial achievements position it well for future growth, making it an attractive option for value investors.
Explore the complete 8-K earnings release (here) from Axos Financial Inc for further details.
