Rocket Companies (RKT) AI Stock Analysis

• Market Cap: $27.52B
• Dividend Yield: N/A
• Average Volume (3M): 12.93M
• Price to Earnings (P/E): 68.5
• Beta (1Y): 0.83
• Revenue Growth: 24.58%
• EPS Growth: -88.86%
• Country: US
• Employees: 14,200
• Sector: Financial
• Sector Strength: 73
• Industry: Financial - Mortgages
• EPS (TTM): 0.04
• Shares Outstanding: 151,353,840
• 10 Day Avg. Volume: 12,241,710
• 30 Day Avg. Volume: 12,928,671
• PEG Ratio: -0.01
• Price to Book (P/B): 1.46
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.08
• Enterprise Value/Market Cap: 0.32
• Enterprise Value/Revenue: 0.45
• Enterprise Value/Gross Profit: 1.92
• Enterprise Value/Ebitda: 6.42
• 1Y Price Target: $14.00
• Price Target Upside: 1.74% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 9

• Rating: 56 Neutral
• Price Target: $14.50 ▲(5.38%Upside)

Rocket Companies is navigating a challenging financial landscape with declining revenues and profitability pressures. However, technical indicators show positive momentum, and the earnings call highlights strong strategic initiatives and AI integration that enhance growth prospects. Valuation remains a concern due to negative earnings, but strategic acquisitions could provide long-term value.

Positive Factors

Growth Opportunities

The inclusion of a merger model reflects potential growth opportunities from recent acquisitions.

Strategic Acquisitions

The overlap of Mr. Cooper and Rocket Companies makes operational sense, potentially leading to uplift in recapture rates and straightforward expense synergies.

Negative Factors

Investor Concerns

Investors are worried about Rocket Companies' willingness to use its stock for large mergers and acquisitions.

Market Conditions

Unfavorable market conditions are influencing a neutral rating on Rocket Companies.

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 Mortgage, a mortgage lender; Amrock that provides title insurance, property valuation, and settlement services; Rocket Homes, a home search platform and real estate agent referral network, which offers technology-enabled services to support the home buying and selling experience; Rocket Auto, an automotive retail marketplace that provides centralized and virtual car sales support to online car purchasing platforms; and Rocket Loans, an online-based personal loans business. It also offer Core Digital Media, a digital social and display advertiser in the mortgage, insurance, and education sectors; Rocket Solar, which connect homeowners with digital financing solutions through a team of trained solar advisors; Truebill, a personal finance app that helps clients manage every aspect of their financial lives; Lendesk, a technology services company that provides a point of sale system for mortgage professionals and a loan origination system for private lenders; and Edison Financial, a digital mortgage broker. In addition, the company originates, closes, sells, and services agency-conforming loans. Rocket Companies, Inc. was founded in 1985 and is headquartered in Detroit, Michigan. Rocket Companies, Inc. operates as a subsidiary of Rock Holdings, Inc.

How the Company Makes Money

Rocket Companies primarily generates revenue through its mortgage origination and servicing operations. The company earns fees from originating new mortgages, which are subsequently sold to investors in the secondary market. Additionally, Rocket Companies generates income from the servicing of these loans, earning fees for managing the day-to-day operations of the mortgage accounts, including collecting payments and handling escrow accounts. The company also benefits from interest income on loans held for sale and gains on the sale of loans. Strategic partnerships and marketing agreements with real estate brokers and other financial institutions further bolster its revenue streams.

Rocket Companies Financial Statement Overview

Summary

Rocket Companies is facing financial challenges with declining revenues and profitability. Despite high gross profit margins, the company's leverage and negative cash flow pose significant risks, requiring strategic adjustments to improve financial stability.

Income Statement

Rocket Companies has faced significant revenue challenges with a decline from $13.18 billion in 2021 to $5.07 billion TTM, indicating a sharp contraction. Gross profit margins remain high at over 90%, showcasing pricing power. However, net income margins have dwindled, with a TTM net income of only $2.77 million, indicating profitability pressures.

Balance Sheet

The company has a high debt-to-equity ratio, reflecting considerable leverage and potential financial risk. However, equity has been relatively stable. Asset quality is a concern given the high levels of liabilities relative to equity. Stockholders' equity has shown volatility, which can pose risks under adverse conditions.

Cash Flow

Negative free cash flow in the TTM period highlights cash management challenges. The company had a negative operating cash flow of $413 million TTM, suggesting operational inefficiencies. Large capital expenditures relative to operating cash flow have further strained liquidity.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.07B	5.40B	4.01B	6.00B	13.18B	15.90B
	Gross Profit
4.59B	4.93B	3.65B	5.68B	12.68B	15.46B
	EBIT
146.58M	668.05M	-402.90M	741.91M	6.18B	9.53B
	EBITDA
259.39M	780.97M	-292.63M	835.93M	6.26B	9.61B
	Net Income Common Stockholders
2.77M	29.37M	-15.51M	46.42M	308.21M	197.95M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.17B	4.06B	1.14B	722.29M	2.13B	1.97B
	Total Assets
25.25B	24.51B	19.23B	20.08B	32.77B	37.53B
	Total Debt
14.80B	13.98B	9.56B	8.71B	19.26B	21.95B
	Net Debt
13.39B	12.70B	8.43B	7.98B	17.13B	19.98B
	Total Liabilities
16.67B	15.47B	10.93B	11.61B	23.02B	29.65B
	Stockholders Equity
583.97M	702.50M	624.90M	576.70M	665.66M	490.50M
Cash Flow		Free Cash Flow
-1.26B	-3.43B	49.99M	10.72B	7.44B	-1.78B
	Operating Cash Flow
-413.52M	-2.63B	110.33M	10.82B	7.74B	-1.68B
	Investing Cash Flow
-455.66M	-495.47M	861.15M	578.74M	-664.85M	517.20M
	Financing Cash Flow
1.41B	3.28B	-623.56M	-12.82B	-6.92B	1.76B

Rocket Companies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.76
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 13.76 is above the 20-day moving average (MA) of 12.97, above the 50-day MA of 12.72, and above the 200-day MA of 13.72, indicating a bullish trend. The MACD of 0.27 indicates Negative momentum. The RSI at 59.59 is Neutral, neither overbought nor oversold. The STOCH value of 88.10 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RKT.

Rocket Companies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COOP	69 Neutral	$9.16B	16.25	12.39%	―	6.44%	-7.86%
Sector *	64 Neutral	$12.77B	9.71	7.85%	78.05%	12.07%	-7.97%
PFSI	61 Neutral	$4.95B	14.71	9.32%	1.25%	23.79%	121.61%
GHLD	57 Neutral	$973.59M	22.54	3.71%	3.19%	42.92%	64.72%
RKT	56 Neutral	$27.52B	68.51	0.45%	―	24.58%	-88.86%
WD	49 Neutral	$2.32B	23.43	5.62%	3.92%	6.68%	6.08%
UWMC	41 Neutral	$6.68B	37.74	-5.74%	9.57%	9.19%	-171.38%

Rocket Companies Corporate Events

Rocket Companies Announces $4 Billion Senior Notes Offering

On June 3 and June 5, 2025, Rocket Companies announced and priced a private offering of $4 billion in senior notes due in 2030 and 2033. These notes will be guaranteed by Rocket Mortgage and its subsidiaries, and potentially by Redfin and Mr. Cooper upon their acquisitions. The proceeds will be used for redeeming existing notes, paying related fees, and repaying secured debt. The offering is not contingent on the acquisitions, but there are provisions for mandatory redemption if the Mr. Cooper acquisition is not completed by September 30, 2026.

The most recent analyst rating on (RKT) stock is a Hold with a $14.00 price target. To see the full list of analyst forecasts on Rocket Companies stock, see the RKT Stock Forecast page.

Rocket Companies Announces Board Size Reduction

On May 20, 2025, Rocket Companies announced that Nancy Tellem decided not to stand for re-election as a Class II director, with her term ending on June 11, 2025. Following her departure, the Board decided to reduce its size to eight directors, effective upon the expiration of her term.

The most recent analyst rating on (RKT) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Rocket Companies stock, see the RKT Stock Forecast page.

Rocket Companies Ends Credit Agreement with JPMorgan

Rocket Companies terminated its Revolving Credit Agreement dated July 4, 2024, with JPMorgan Chase Bank, N.A., without incurring any early termination penalties or prepayment premiums. This move may impact the company’s financial strategy and liquidity management, potentially influencing its market positioning and stakeholder relations.

Rocket Companies Announces Acquisition of Mr. Cooper Group

On March 31, 2025, Rocket Companies announced a definitive agreement to acquire Mr. Cooper Group Inc. in an all-stock transaction valued at $9.4 billion. This merger aims to create a combined servicing portfolio of $2.1 trillion, enhancing Rocket’s market position by integrating Mr. Cooper’s servicing platform with Rocket’s origination capabilities. The transaction is expected to generate significant revenue and cost synergies, contributing to organic growth and increased operating leverage. The merger, which has been approved by both companies’ boards, is anticipated to close in the fourth quarter of 2025, pending shareholder and regulatory approvals.