Needham analyst Kyle Peterson has initiated coverage of Axos Financial, Inc. (AX) with a ‘Buy’ rating and a price target of $82.00. Peterson’s bullish stance is rooted in his belief that Axos Financial stands apart from traditional banks by prioritizing a digital-first strategy. This approach, he argues, enhances profitability and efficiency while simultaneously expanding the company’s total addressable market.
Axos Financial’s full banking license is another key advantage, providing the company with a stable and cost-effective funding source for loans compared to traditional warehouse lines. This license also allows Axos Financial to offer a comprehensive range of in-house banking products.
Peterson emphasizes that Axos Financial was ahead of the curve in adopting a digital-first strategy, a decision that has proven to be highly effective as digital banking continues to gain popularity. The analyst also points to Axos Financial’s unique corporate culture as a differentiator, contributing to the company’s ability to expand its reach and achieve efficient growth.
Axos Financial’s exceptional profitability, according to Peterson, is driven by its robust underwriting and credit performance, combined with a streamlined expense structure. He projects earnings per share (EPS) of $7.05 in 2025 and $7.40 in 2026.
Investors seeking exposure to Axos Financial can consider the Principal U.S. Small-Cap ETF (PSC) and the WisdomTree U.S. SmallCap Fund (EES). As of Friday’s close, AX shares were up 5.25% at $63.58.
