Critical Contrast: First Internet Bancorp (NASDAQ:INBK) and Axos Financial (NYSE:AX)

Axos Financial (NYSE:AX) and First Internet Bancorp (NASDAQ:INBK) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.

Profitability

This table compares Axos Financial and First Internet Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Axos Financial	22.39%	16.96%	1.77%
First Internet Bancorp	-9.01%	-0.55%	-0.04%

Analyst Ratings

This is a summary of recent ratings and price targets for Axos Financial and First Internet Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Axos Financial	0	2	5	1	2.88
First Internet Bancorp	1	3	2	0	2.17

Axos Financial presently has a consensus target price of $115.67, suggesting a potential upside of 27.41%. First Internet Bancorp has a consensus target price of $29.38, suggesting a potential upside of 6.39%. Given Axos Financial’s stronger consensus rating and higher possible upside, equities analysts clearly believe Axos Financial is more favorable than First Internet Bancorp.

Insider & Institutional Ownership

83.8% of Axos Financial shares are owned by institutional investors. Comparatively, 65.5% of First Internet Bancorp shares are owned by institutional investors. 4.8% of Axos Financial shares are owned by company insiders. Comparatively, 6.2% of First Internet Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Axos Financial has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, First Internet Bancorp has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500.

Valuation and Earnings

This table compares Axos Financial and First Internet Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Axos Financial	$2.19 billion	2.35	$490.37 million	$8.47	10.72
First Internet Bancorp	$322.87 million	0.75	-$35.17 million	($3.60)	-7.67

Axos Financial has higher revenue and earnings than First Internet Bancorp. First Internet Bancorp is trading at a lower price-to-earnings ratio than Axos Financial, indicating that it is currently the more affordable of the two stocks.

Summary

Axos Financial beats First Internet Bancorp on 14 of the 15 factors compared between the two stocks.

About Axos Financial

Axos Financial, Inc., together with its subsidiaries, provides consumer and business banking products in the United States. It operates through two segments, Banking Business and Securities Business. The company offers deposits products, including consumer and business checking, demand, savings, time deposit, money market, zero balance, and insured cash sweep accounts. It also provides residential single family, multifamily, and commercial mortgage loans; commercial real estate secured loans; commercial and industrial non-real estate, asset-backed, lines of credit, and term loans; automobile loans; fixed rate unsecured loans; and other loans, such as structure settlements, small business administration consumer loans, and securities-backed loans. In addition, the company offers ACH origination, wire transfer, commercial check printing, business bill pay and account transfer; remote deposit capture, mobile deposit, lockbox, merchant, and online payment portal; concierge banking; mobile and text message banking; and payment services, as well as debit and credit cards, and digital wallets. Further, it provides disclosed clearing services; back-office services, such as record keeping, trade reporting, accounting, general back-office support, securities and margin lending, reorganization assistance, and custody of securities; and financing to brokerage customers. The company was formerly known as BofI Holding, Inc. and changed its name to Axos Financial, Inc. in September 2018. Axos Financial, Inc. was incorporated in 1999 and is based in Las Vegas, Nevada.

About First Internet Bancorp

First Internet Bancorp operates as the bank holding company for First Internet Bank of Indiana that provides commercial, small business, consumer, and municipal banking products and services to individuals and commercial customers in the United States. The company accepts non-interest bearing and interest-bearing demand deposit, commercial deposit, savings, money market, and Banking-as-a-Service brokered deposit accounts, as well as certificates of deposit. It also offers commercial and industrial, owner-occupied and investor commercial real estate, construction, residential mortgage, home equity, line of credit and home improvement, small installment, term, and other consumer loans, as well as single tenant lease financing, and public and healthcare finance; franchise finance; and small business lending. In addition, the company is involved in the purchase, manage, service, and safekeeping of municipal securities; and provision of public and municipal lending and leasing products to government entities. Further, the company offers corporate credit card and treasury management services. First Internet Bancorp was founded in 1998 and is headquartered in Fishers, Indiana.