Axos Financial price target raised to $100 by KBW on accretive acquisition

Investing.com - Keefe, Bruyette & Woods raised its price target on Axos Financial (NYSE:AX) stock to $100.00 from $94.00 while maintaining a Market Perform rating.

The price target increase follows Axos Financial’s announcement of a $43.5 million all-cash acquisition of Verdant Commercial Capital, an independent equipment leasing business with $1.1 billion in loans and leases across six verticals nationwide.

KBW views the transaction as financially attractive, projecting 2-3% earnings accretion in fiscal year 2026 and 5-6% accretion in fiscal year 2027, with minimal tangible book value dilution.

The research firm noted that Axos has historically excelled at developing niches with attractive risk-adjusted returns, suggesting this specialty lending acquisition aligns with the company’s merger and acquisition strategy.

KBW believes the deal will add scale to Axos Financial’s existing business operations and help support the company’s leading profitability metrics going forward.

In other recent news, Axos Financial announced the acquisition of Verdant Commercial Capital for approximately $43.5 million in cash, including a portfolio valued at $1.1 billion. This acquisition has prompted Needham to raise its price target for Axos Financial to $105, maintaining a Buy rating, while DA Davidson increased its target to $106, also retaining a Buy rating. Furthermore, Axos Financial completed a $200 million subordinated notes offering with a 7.00% Fixed-to-Floating Rate, managed by Keefe, Bruyette & Woods. This financial move is expected to support the company’s capital structure, as Keefe, Bruyette & Woods anticipates Axos will redeem $160.5 million of existing subordinated debt next month. The research firm reiterated its Market Perform rating with a $94 price target. These developments reflect strategic financial maneuvers by Axos Financial to strengthen its market position and financial outlook.

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