Rocket Companies (RKT)
NYSE:RKT
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Rocket Companies
(NYSE:RKT)
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Rating:52Neutral
Price Target:
$16.00
▼(-14.35% Downside)
Action:Reiterated
Date:05/07/26
The score is held back primarily by weak cash flow and inconsistent profitability despite improving revenue and a de-risked balance sheet. Technicals also remain bearish with the stock below key moving averages and negative MACD. These negatives are partially offset by a constructive earnings call featuring above-guidance Q1 performance, efficiency gains, and synergy progress, but valuation is still demanding with a very high P/E.
Positive Factors
Large Servicing Portfolio / Recurring Revenue
A $2.1 trillion servicing footprint with >$1 billion in servicing fee income creates durable, recurring cash flows and recapture advantages. This structural revenue mix (less rate-sensitive) stabilizes earnings across rate cycles and supports cross-sell and lower-cost originations over months to years.
Negative Factors
Weak Cash Generation
Consistent negative operating and free cash flow undermines earnings quality and financial flexibility. For a mortgage originator, volatile cash conversion raises concerns about funding needs, warehouse reliance, and the ability to sustain buybacks, reinvestment, or capital returns over coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Large Servicing Portfolio / Recurring Revenue
A $2.1 trillion servicing footprint with >$1 billion in servicing fee income creates durable, recurring cash flows and recapture advantages. This structural revenue mix (less rate-sensitive) stabilizes earnings across rate cycles and supports cross-sell and lower-cost originations over months to years.
Read all positive factors
Rocket Companies Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes revenue from different business segments, highlighting which areas drive growth and profitability, and revealing strategic focus and potential vulnerabilities.
Analyzes revenue from different business segments, highlighting which areas drive growth and profitability, and revealing strategic focus and potential vulnerabilities.
Data provided by:
The Fly
The FlyRocket Companies (RKT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$41.73B
Dividend YieldN/A
Average Volume (3M)25.14M
Price to Earnings (P/E)33.9
Beta (1Y)0.43
Revenue Growth73.75%
EPS Growth269.75%
CountryUS
Employees14,200
SectorFinancial
Sector Strength70
IndustryFinancial - Mortgages
Share Statistics
EPS (TTM)-0.12
Shares Outstanding970,935,900
10 Day Avg. Volume28,555,714
30 Day Avg. Volume25,139,819
Financial Highlights & Ratios
PEG Ratio6.21
Price to Book (P/B)2.09
Price to Sales (P/S)6.94
P/FCF Ratio-11.88
Enterprise Value/Market Cap1.76
Enterprise Value/Revenue10.72
Enterprise Value/Gross Profit11.83
Enterprise Value/Ebitda114.76
Forecast
1Y Price Target
$20.50Price Target Upside9.74% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)0.74
Revenue Forecast (FY)$11.66B
Rocket Companies Business Overview & Revenue Model
Company Description
Rocket Companies, Inc. engages in the tech-driven real estate, mortgage, and e-Commerce businesses in the United States and Canada. It operates through two segments, Direct to Consumer and Partner Network. The company's solutions include Rocket Mo...
How the Company Makes Money
Rocket Companies primarily makes money through its mortgage banking activities and related services. A major revenue driver is originating residential mortgages: Rocket earns revenue from origination fees and by selling originated loans into the s...
Rocket Companies Earnings Call Summary
Earnings Call Date:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The call presents a largely positive picture: the company delivered strong Q1 results (revenue and EBITDA above guidance, margin expansion, and EPS improvement), meaningful AI-driven efficiency and conversion gains, accelerated integration synergies (Mr. Cooper) realized ahead of schedule, and materially increased origination capacity and partner additions. Headwinds are primarily macro-driven — rate volatility tied to geopolitical events, a slower-than-normal spring housing season, and some short-term refinance pullback — which management expects to weather given a defensive revenue mix (≈70% recurring/less rate-sensitive) and continued operating leverage. Overall, the operational and strategic positives outweigh the near-term market challenges.Positive Updates
Adjusted Revenue Above Guidance
Adjusted revenue of $2.822 billion in Q1, exceeding the high end of guidance.
Negative Updates
Macro-Driven Rate Volatility
Mortgage rates moved from ~6.15% in January to just under 6% in February, then up to ~6.5% in March, creating an uneven spring season and headwinds for refinance volumes.
Read all updates
Q1-2026 Updates
Positive
Negative
Adjusted Revenue Above Guidance
Adjusted revenue of $2.822 billion in Q1, exceeding the high end of guidance.
Read all positive updates
Company Guidance
For Q2 the company guided adjusted revenue of $2.7–$2.9 billion (midpoint reflecting continued share gains) and expects total expenses of about $2.43 billion at the midpoint—which include $110 million of amortization, $100 million of stock‑based compensation and $20 million of one‑time acquisition costs—implying core expenses of roughly $2.2 billion (about $60 million below Q1); volumes are expected to be similar to Q1 (Q1 net rate‑lock $49 billion, adj. revenue $2.822 billion, adj. EBITDA $738 million and adj. EPS $0.15) despite mortgage rates being ~50 bps higher (10‑yr ≈4.40%), March closings of nearly $20 billion, and a slower spring market (homes averaging 51 days on market); management also reiterated synergy phasing—$75 million of annualized savings realized, another $100 million expected by end‑Q2 and the remaining $225 million in H2 to hit the $400 million target in 2026—and highlighted up to $300 billion of origination capacity enabled by AI and productivity gains (loans closed per team member up ~75% vs. two years ago).Rocket Companies Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
63
Positive
Cash Flow
31
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 6.88B | 5.40B | 4.01B | 6.00B | 13.18B |
| Gross Profit | 6.30B | 4.93B | 3.65B | 5.68B | 12.68B |
| EBITDA | 890.00M | 780.97M | -292.63M | 835.93M | 6.26B |
| Net Income | -68.00M | 29.37M | -15.51M | 46.42M | 308.21M |
Balance Sheet | |||||
| Total Assets | 60.69B | 24.51B | 19.23B | 20.08B | 32.77B |
| Cash, Cash Equivalents and Short-Term Investments | 2.70B | 1.27B | 1.11B | 722.29M | 4.05B |
| Total Debt | 0.00 | 13.98B | 9.56B | 10.35B | 21.18B |
| Total Liabilities | 37.79B | 15.47B | 10.93B | 11.61B | 23.02B |
| Stockholders Equity | 22.90B | 702.50M | 624.90M | 576.70M | 665.66M |
Cash Flow | |||||
| Free Cash Flow | -4.02B | -3.43B | 49.99M | 10.72B | 7.44B |
| Operating Cash Flow | -3.93B | -2.63B | 110.33M | 10.82B | 7.74B |
| Investing Cash Flow | -2.53B | -495.47M | 861.15M | 578.74M | -664.85M |
| Financing Cash Flow | 8.10B | 3.28B | -623.56M | -12.82B | -6.92B |
Rocket Companies Technical Analysis
Positive
18.68
Price Trends
16.05
Positive
18.09
Negative
17.69
Negative
Market Momentum
0.02
Negative
62.33
Neutral
86.41
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RKT, the sentiment is Positive. The current price of 18.68 is above the 20-day moving average (MA) of 14.72, above the 50-day MA of 16.05, and above the 200-day MA of 17.69, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 62.33 is Neutral, neither overbought nor oversold. The STOCH value of 86.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RKT.
Rocket Companies Risk Analysis
Rocket Companies disclosed 64 risk factors in its most recent earnings report. Rocket Companies reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rocket Companies Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
56 Neutral | $4.60B | 13.84 | 12.02% | 0.90% | 24.55% | 43.82% | |
52 Neutral | $41.73B | 33.93 | 1.53% | ― | 73.75% | 269.75% | |
52 Neutral | $5.24B | 10.45 | 12.32% | 8.64% | 37.10% | ― | |
43 Neutral | $421.28M | -2.17 | -24.39% | ― | 14.29% | 21.88% |
* Financial Sector Average
RKT
Rocket Companies
13.84
1.24
9.84%
PFSI
PennyMac Financial
87.74
-10.20
-10.41%
LDI
loanDepot
1.21
0.00
0.00%
UWMC
UWM Holding
3.10
-0.67
-17.75%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.