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Axos Financial (NYSE:AX) Shareholders Have Enjoyed A 64% Share Price Gain

Simply Wall St

It hasn't been the best quarter for Axos Financial, Inc. (NYSE:AX) shareholders, since the share price has fallen 11% in that time. But don't let that distract from the very nice return generated over three years. In the last three years the share price is up, 64%: better than the market.

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See our latest analysis for Axos Financial

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Axos Financial was able to grow its EPS at 11% per year over three years, sending the share price higher. This EPS growth is lower than the 18% average annual increase in the share price. This indicates that the market is feeling more optimistic on the stock, after the last few years of progress. It's not unusual to see the market 're-rate' a stock, after a few years of growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

NYSE:AX Past and Future Earnings, May 21st 2019

Dive deeper into Axos Financial's key metrics by checking this interactive graph of Axos Financial's earnings, revenue and cash flow.

A Different Perspective

Axos Financial shareholders are down 31% for the year, but the market itself is up 4.8%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 8.0%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.