Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Bull of the Day: Rocket Companies (RKT)

By Zacks Investment ResearchStock MarketsOct 18, 2021 06:30AM ET
Bull of the Day: Rocket Companies (RKT)
By Zacks Investment Research   |  Oct 18, 2021 06:30AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

Rocket Companies (RKT) is a Zacks #1 (Strong Buy) that consists of personal finance and consumer service brands. Some popular segments include Rocket Mortgage, Rocket Homes, Rocket Auto and Rocket Loans.

The company debuted last year when it had its IPO in August of 2020. Since then, the stock became a favorite of the meme crowd, which caused a violent spike over $40 back in March. But the last few months have not been kind, with the stock falling to all-time lows last week.

However, there has been some buying interest with the recent market rally. And with estimates ticking higher, is it time for the stock to lift off?

About the Company

Rocket is headquartered in Detroit, Michigan and was founded in 1985. The company has a team of 26,000 employees and its flagship company, Rocket Mortgage has consistently been named one of the “100 Best Companies to Work For” by Fortune magazine.

Rocket has a market cap of about $32 Billion and has Zacks Style Scores of “B” in Value but “F” in Growth. The Forward PE is 7, which makes it attractive to value investors.

Q2 Earnings

Rocket reported earnings in August, seeing results come in as expected. Revenue was a slight beat, but the company posted $0.46 v $0.46 expected. Adjusted EBITDA was lower year over year, but closed loan originations came in at $83.8B v the $72.3B.

The CEO commented that they are on pace to be the largest retail home purchase lender in the nation by the end of 2023. He added that their newer businesses Rocket Homes, Rocket Auto and solar program represent significant growth opportunities.

The company has only missed once since becoming a publicly traded stock. Rocket next reports November 11th and estimates have been ticking higher.


Over the last 90 days, earnings estimates have jumped higher across most time frames. For the current quarter, we have seen estimates raised by 30%, from $0.37 to $0.48. For the current year, we have seen a 6% move higher in that same time frame.

Value play and short Interest

The low PE makes this stock very attractive to value investors. Obviously, the market thinks that growth won’t be as rosy investors think. However, if the company does beat expectations, the bulls will be quick to jump in.

Additionally, the stock has a rather large short interest, with about 12 million shares short the stock. This is about 10% of the float, so any positive catalyst will force shorts to buy back the stock.

The Technicals

As mentioned above, the stock recently hit its all-time low just under $15. But the reaction from that level has been extremely positive. The stock snapped back to the $17 area, which is the 50-day moving average. Sellers showed up there, but if the bulls get above that level, we could get some short covering to the 200-day MA.

That 200-day is currently at $19.50, or almost 20% higher from current levels. We most likely need a catalyst to get there and perhaps earnings will be just that.

Bottom Line

Rocket continues to gain market share in the mortgage market and believe their goals for next year are achievable. This stock has been forgotten by the retail crowd, but next months earnings could bring interest back into the name.

Time to Invest in Legal Marijuana

If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%.

You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Rocket Companies, Inc. (RKT): Free Stock Analysis Report

To read this article on click here.
Bull of the Day: Rocket Companies (RKT)

Related Articles

Jani Ziedins
Why Bears Keep Getting It Wrong By Jani Ziedins - Dec 03, 2021 1

Surprise, surprise, the S&P 500 recovered from Wednesday’s massive intraday reversal. Okay, no one was really surprised because Thursday’s 1.4% bounce was the market’s third...

Bull of the Day: Rocket Companies (RKT)

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email