Just like Dow Jones leader JPMorgan Chase this week, smaller financial leader Axos Financial is setting up for a move higher after clearing a resistance level. That makes Axos stock one of the best to watch right now and is Wednesday's IBD 50 Stocks To Watch pick.
Las Vegas-based Axos Financial serves as a holding company for Axos Bank, a provider of consumer and business banking. Axos Financial also owns Axos Clearing and Axos Invest, which provide securities clearance services for broker dealers and registered investment advisors.
On April 30, Axos reported fiscal third-quarter earnings for the period ended March 31. The company's sales increased 27% to $294.8 million, while earnings jumped 44% to $1.94 per share. Net income increased 38.7% to $110.7 million.
The company's sales and earnings have been on a steady growth path over the past eight quarters. Sales growth has ranged between 18% and 55% while earnings growth has been between 15% and 44%.
Current-quarter estimates are for earnings of $1.80 per share, up 24% vs. the year-ago period, according to IBD MarketSurge. Looking forward, Axos' earnings are expected to jump 43% in the fiscal year that just ended in June before easing to 6% the next fiscal year.
Be sure to read how to adjust to changing market conditions, with IBD's new exposure levels.
Dow Jones Stock JPMorgan Breaks Out; Axos In Base
Dow Jones leader JPMorgan is in buy range past a 205.88 flat-base buy point, according to MarketSurge pattern recognition. The 5% buy area goes up to 216.17. JPMorgan was Monday's IBD Stock Of The Day.
But while JPMorgan's breakout saw strong price and volume action, Axos has yet to move to new highs.
Axos shares are tracing a cup base that shows a 63 buy point after regaining their 50-day moving average this week. Shares are about 7% away from their entry, so keep an eye out for a potential handle to offer a lower entry. With IBD's recommended equity exposure range at 80%-100%, investors should still be looking to buy breakouts among top-rated stocks.
Axos stock shows a 96 out of 99 IBD Composite Rating, according to IBD Stock Checkup, mainly due to a three-year EPS growth rate 22% and strong price action since a low in November.
The relative strength line is taking a breather after a spike in May. Look for resurgent strength in the RS line to indicate confirmation of stock market leadership.
Find The Best Stocks To Buy And Watch With IBD Stock Screener And IBD Screen Of The Day
Best Stocks To Watch
Three IBD 50 Growth Stocks To Watch picks from earlier this year are among the best stocks to watch.
| Company | Symbol | Buy point | Type of base |
|---|---|---|---|
| Hilton | 215.79 | Flat base | |
| Booz Allen Hamilton | 164.43 | Flat base | |
| Palantir Technologies | 26.57 | Cup with handle |
Source: IBD Data As Of July 3, 2024
Follow Scott Lehtonen on X, formerly known as Twitter, at @IBD_SLehtonen for more on the best stocks to buy and watch and the Dow Jones Industrial Average.
