Is Rocket mortgage stock a good buy?
We rate shares of RKT as a buy with a price target of $17.50 for the year ahead representing a forward P/E of 15x on the current consensus 2022 EPS. We believe the company will ultimately outperform expectations, benefiting from a stronger than expected housing market and demand for mortgages overall.Mar 3, 2022
Is Rocket stock a buy?
With the new Buy, five out of six, or 83%, of analysts rates Rocket shares Buy. The average Buy-rating ratio for small-capitalization stocks is about 65%. The average analyst price target for Rocket stock is about $20.50 a share, higher than Liwag's. That price implies gains of about 90% from recent levels.Jan 12, 2022
Should you buy RKT stock?
The financial health and growth prospects of RKT, demonstrate its potential to outperform the market. It currently has a Growth Score of A. Recent price changes and earnings estimate revisions indicate this would be a good stock for momentum investors with a Momentum Score of B.
What is wrong with rocket mortgage stock?
According to Inman, its revenue fell 32% to $3.11 billion while net income declined 53% to $1.39 billion. The problem facing Rocket is its dependence on its more profitable refinancing business which suffered as higher interest rates lowered demand and margins.Jan 8, 2022
Does Rocket mortgage pay dividends?
Our Company's Board of Directors declared a special dividend of $1.01 per share payable on March 22, 2022 to holders of our Class A common stock of record at the close of business on March 8, 2022. We will fund the special dividend from cash distributions of approximately $2.0 billion.Feb 24, 2022
Does RKT pay a dividend?
RKT pays a dividend of $1.01 per share. RKT's annual dividend yield is 10.92%. ROCKET COMPANIES's dividend is higher than the US industry average of 9.56%, and it is higher than the US market average of 4.11%.
Why is Rocket Companies pe so low?
Shares of Rocket Companies Inc. RKT, -0.72% sank 7.3% toward a record low in midday trading Tuesday, after BofA Securities turned bearish on the mortgage financing company, citing concerns over the impact of a rising rate environment.Feb 22, 2022
What kind of company is rocket companies?
holding companyOverview. Rocket Companies (NYSE: RKT) is a Detroit-based holding company consisting of personal finance and consumer service brands.
Is Rocket mortgage a fintech company?
Leadership changes at Rocket Cos. are part of a strategy to not only become the nation's biggest provider of purchase mortgages in 2022, but to convince investors that they should think of Rocket and its growing stable of more than a dozen brands as a fintech platform.Jan 12, 2022
Is Rocket a good company?
Rocket is also an extremely profitable company that made record profits in the fiscal year (FY) 2020. In its FY 2020 earnings report, it saw a revenue of $15.73 billion, up 208% year-over-year (YoY), whilst its net income was up a whopping 948% to $9.39 billion.Jun 11, 2021
Does Rocket own Quicken Loans?
One Giant Leap: Quicken Loans Announces It's Changing Name to Rocket Mortgage. DETROIT, May 12, 2021 – Quicken Loans, America's largest mortgage lender and a part of Rocket Companies (NYSE: RKT), today announced it will officially change its name to Rocket Mortgage on July 31.May 12, 2021
What is mortgage company?
Mortgage companies are in the business of originating home loans for people looking to buy a house or refinance an existing home loan. However, mortgage companies like Rocket, loanDepot, and UWM Holdings, which have also experienced pops recently, are not licensed banks, so they don't hold a lot of mortgages on their balance sheets.
Who is Bram Berkowitz?
Bram Berkowitz mainly writes in the financials bureau covering the banking sector. Prior to The Motley Fool, he wrote about and covered community and regional banks in New England for The Warren Group.
Outstanding financial results and guidance
Rocket Mortgage — which includes “Quicken Loans, the nation’s No. 1 ranked mortgage lender, title company Amrock, home search platform Rocket Homes, personal loans provider Rocket Loans and call center Rock Connections,” noted the Wall Street Journal — gave investors a boffo earnings report on February 25.
Special dividend
Rocket made so much money that it’s issuing a special dividend which will be paid to stockholders as of March 9. As the Journal noted Rocket will pay such shareholders “a new special and non-recurring dividend of $1.11 per share which will total about $2.2 billion.”
Trading below its price target
While analyst price targets are hardly scientific, the average target of $25.14 is slightly above where Rocket closed on March 1. “Based on seven analysts offering 12 month price targets for Rocket Companies in the last 3 months. The average price target is $25.14 with a high forecast of $33.00 and a low forecast of $19.00.
Rising interest rates could slow demand for mortgages
The case to bet that Rocket stock will go down hinges on rising mortgage rates and a high valuation.
The stock trades at a big premium to peers
Short sellers could make the case that Rocket shares are over-valued compare to those of its peers. Indeed, the Journal noted that Rocket sported “a premium valuation before its earnings report of around 11 times FactSet’s consensus 2022 earnings — which is nearly twice that of peers’ — around 6 times.”
What is Rocket Mortgage?
It operates in 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 national car rental and online car purchasing platforms; and Rocket Loans, an online-based personal loans business. Its solutions also include Core Digital Media, a digital social and display advertiser in the mortgage, insurance, and education sectors; Nexsys, a fintech company, which offers a suite of essential tech solutions for mortgage origination and closing processes through digitization and automation; 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 startup. In addition, the company originates, closes, sells, and services agency-conforming loans. Rocket Companies, Inc.
Who is Shannon Terrell?
Shannon Terrell is a senior writer for Finder who has written over 400 personal finance guides. With a focus on investments and personal finance, she breaks down jargon-laden topics to help others make informed financial decisions. She studied communications and English literature at the University of Toronto.
What happens when rates rise?
When rates rise, people hang on to their great rates, and the servicer will get that cash flow for a lot longer. Conversely, when rates are falling, the borrower might refinance every other year, which means the servicer only gets that 0.25% fee for a couple years.
When did the bond bull market start?
Bond bull markets last decades. In fact, the beginning of the current bond bull market dates back to early in the Reagan administration, when Fed Chairman Paul Volcker raised rates to break the back of 1970s inflation, almost 40 years ago. Take a look at the chart below, which shows the mortgage rate in the 1970s.
Is the bond market a bull market?
While most investors don't give bond markets much thought, bond bull markets and stock bull markets are completely different animals. While the stock market doesn't have any sort of ceiling on valuations or multiples, the bond market has real constraints on future growth, which is the zero bound. Rates are close to zero. The stock market can double from here, but the bond market cannot.
Is the mortgage market competitive?
The mortgage market will certainly be more competitive, and almost surely smaller. Many smaller originators will probably struggle to compete, which means that we will probably see a wave of mergers and acquisitions activity. Rocket will almost certainly be an acquirer.