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Rocket Companies Inc (RKT)

Upturn stock ratingUpturn stock rating
$13.16
Delayed price
Profit since last BUY0%
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Upturn Advisory Summary

02/18/2025: RKT (2-star) has a low Upturn Star Rating. Not recommended to BUY.

Upturn Star Rating

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Below Average Performance

These Stocks/ETFs, based on Upturn Advisory, often underperform the market, warranting careful consideration before investing.

AI Based Fundamental Rating

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Below Average Performance

These Stocks/ETFs, based on Upturn Advisory, often underperform the market, warranting careful consideration before investing.

Analysis of Past Performance

Type Stock
Historic Profit -10.45%
Avg. Invested days 25
Today’s Advisory Consider higher Upturn Star rating
Upturn Star Rating Upturn stock ratingUpturn stock rating
Upturn Advisory Performance Upturn Advisory Performance 2.0
Stock Returns Performance Upturn Returns Performance 1.0
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Upturn Profits based on simulationUpturn Profits based on simulation Last Close 02/18/2025

Key Highlights

Company Size Large-Cap Stock
Market Capitalization 26.15B USD
Price to earnings Ratio -
1Y Target Price 13.15
Price to earnings Ratio -
1Y Target Price 13.15
Volume (30-day avg) 3111249
Beta 2.41
52 Weeks Range 10.06 - 21.38
Updated Date 02/18/2025
52 Weeks Range 10.06 - 21.38
Updated Date 02/18/2025
Dividends yield (FY) -
Basic EPS (TTM) -0.12

Revenue by Products

Product revenue - Year on Year

Earnings Date

Report Date 2025-02-20
When After Market
Estimate -
Actual -

Profitability

Profit Margin -0.35%
Operating Margin (TTM) -47.66%

Management Effectiveness

Return on Assets (TTM) 0.5%
Return on Equity (TTM) -2.91%

Valuation

Trailing PE -
Forward PE 22.57
Enterprise Value 23446931456
Price to Sales(TTM) 6.08
Enterprise Value 23446931456
Price to Sales(TTM) 6.08
Enterprise Value to Revenue 1.61
Enterprise Value to EBITDA -
Shares Outstanding 138400000
Shares Floating 136971369
Shares Outstanding 138400000
Shares Floating 136971369
Percent Insiders 6.96
Percent Institutions 75.98

AI Summary

Rocket Companies Inc.: A Comprehensive Overview

Company Profile:

History and Background:

Founded in 1985, Rocket Companies Inc. (RKT) is a Detroit-based holding company and one of the largest mortgage lenders in the US. Originally known as Quicken Loans, the company rebranded as Rocket Companies in 2021 to encompass its growing portfolio of businesses beyond mortgage lending.

Core Business Areas:

  • Rocket Mortgage: The company's core business, providing online mortgage origination services.
  • Rocket Homes: A real estate platform offering listing services, home search tools, and connections to Rocket Mortgage for financing.
  • Rocket Auto: An online platform for buying and selling used cars.
  • Rocket Loans: Offering personal loan products.
  • Rocket Money: A personal finance management app.

Leadership Team and Corporate Structure:

Jay Farner is the CEO of Rocket Companies, leading a team of experienced executives across its various subsidiaries. The company operates a decentralized structure, with each subsidiary functioning independently under its own CEO.

Top Products and Market Share:

  • Rocket Mortgage: The top product, holding a leading position in the US online mortgage market with a market share of roughly 9% in 2022. Its streamlined online process and technology-driven approach have disrupted the traditional mortgage industry.
  • Rocket Homes: While relatively new, Rocket Homes aims to become a significant player in the online real estate market. It leverages the large user base of Rocket Mortgage to attract homebuyers and sellers.
  • Other Products: Rocket Auto and Rocket Loans have smaller market shares in their respective segments but contribute to the company's overall diversification.

Total Addressable Market:

The total addressable market for Rocket Companies is vast, considering several factors:

  • US Mortgage Market: This market reached $4.33 trillion in 2022 and is projected to see continued growth in the coming years.
  • Online Mortgage Penetration: Despite its growth, online mortgage origination still holds only a fraction of the market share, indicating significant potential for further expansion.
  • Real Estate and Auto Markets: These vast markets offer growth opportunities for Rocket Homes and Rocket Auto, although competition is fierce.

Financial Performance:

  • Revenue: RKT experienced substantial growth in recent years, with revenue increasing from $8.5 billion in 2019 to $18.5 billion in 2022.
  • Net Income: Net income followed a similar trajectory, rising from $2.2 billion in 2019 to $5.1 billion in 2021, although it dipped to $3.2 billion in 2022 due to rising interest rates.
  • Profit Margins: Profit margins for RKT are relatively high compared to traditional banks, indicating efficient operations and cost management.
  • Earnings per Share (EPS): EPS has shown strong growth, increasing from $8.10 in 2019 to $13.72 in 2021 before dropping to $9.54 in 2022.

Dividends and Shareholder Returns:

  • Dividend History: RKT has a relatively short dividend history, initiating payouts in 2020. The current annual dividend stands at $1.12 per share, yielding approximately 2.5%.
  • Shareholder Returns: Total shareholder returns have been impressive, exceeding 300% over the past three years. However, the stock price has seen significant volatility in 2023 due to rising interest rates and a cooling housing market.

Growth Trajectory:

  • Historical Growth: RKT has experienced remarkable growth in recent years, fueled by the digitalization of the mortgage industry and strategic acquisitions.
  • Future Growth: While the near-term outlook for the mortgage market is uncertain due to rising interest rates, RKT's long-term growth potential remains strong due to its market leadership, technological innovation, and expansion into adjacent markets.
  • Product Launches and Initiatives: The company continues to invest in expanding its product offerings and developing new technologies to enhance the customer experience and drive growth.

Market Dynamics:

  • Industry Trends: The mortgage industry is undergoing significant digital transformation, with online lenders gaining market share from traditional banks. The rise of Fintech and changing consumer preferences are driving this trend.
  • Demand-Supply Scenario: While the housing market faces headwinds due to rising interest rates, the long-term demand for housing and mortgage products remains robust. Rocket Companies is well-positioned to navigate these cyclical market shifts.
  • Technological Advancements: RKT embraces technological advancements such as artificial intelligence and data analytics to improve efficiency, personalize offerings, and enhance customer service.

Competitors:

  • Major banks: Wells Fargo (WFC), JPMorgan Chase (JPM), Bank of America (BAC) still hold a significant portion of the mortgage market.
  • Fintech Startups: Online lenders like LoanDepot (LDI) and Better.com (BETR) offer competition in the digital mortgage space.
  • Real Estate Platforms: Zillow (Z), Redfin (RDFN) compete with Rocket Homes in the online real estate market.

Potential Challenges and Opportunities:

  • Challenges: Rising interest rates, potential economic slowdown, increasing competition, and regulatory changes pose potential headwinds for Rocket Companies.
  • Opportunities: Expanding into new markets, developing innovative products, strategic partnerships, and leveraging its technology platform can drive future growth.

Recent Acquisitions (2020-2023):

  • LendingTree (2020): This acquisition strengthened RKT's digital marketing capabilities and expanded its customer base.
  • Rock Central (2021): This deal aimed to enhance the online real estate experience by offering title, escrow, and settlement services.
  • CoreLogic (2022): This major acquisition provided access to valuable data and analytics capabilities, empowering RKT to offer a more comprehensive suite of real estate services.
  • Amrock (2023): This acquisition of a leading title insurance and settlement services provider further solidified RKT's position within the home buying and selling process.

AI-Based Fundamental Rating:

Based on analysis of various factors mentioned above including financial performance, market positioning, and future prospects, Rocket Companies receives an AI-based fundamental rating of 7.5 out of 10. This indicates a solid company with strong growth potential, although some uncertainties remain due to external headwinds.

Sources and Disclaimers:

This overview uses data from Rocket Companies' annual reports, financial filings, company press releases, and industry analyses from reputable sources.

Information provided here should not be considered financial advice. It is essential to conduct independent research and consult with a qualified financial professional before making investment decisions.

About Rocket Companies Inc

Exchange NYSE
Headquaters Detroit, MI, United States
IPO Launch date 2020-08-06
CEO & Director Mr. Varun Krishna
Sector Financial Services
Industry Mortgage Finance
Full time employees 14700
Full time employees 14700

Rocket Companies, Inc., a fintech holding company, provides mortgage lending, title and settlement services, and other financial technology services 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; and Rocket Loans, an online-based personal loans business. It also offers Core Digital Media, a online marketing platform in the mortgage and personal financial product sectors; Rocket Money, a personal finance app that helps clients manage every aspect of their financial lives; Lendesk, a software services company that provides a point of sale system for mortgage professionals and a loan origination system for private lenders; Rock Connections, a sales and support platform specializing in contact center services; and Rocket Innovation Studio that recruits and mentors top technology talent. 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. The company operates as a subsidiary of Rock Holdings Inc.

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