Rocket Companies
RKT
$14.40
-5.94%
Rocket Companies, Inc. is a financial services company best known for its Rocket Mortgage business, operating in the mortgage lending industry. It is a market leader and disruptor, leveraging a direct-to-consumer digital platform and a partner network to originate loans, having rapidly gained market share and positioned itself to become the largest mortgage servicer in the US. The current investor narrative is dominated by the stock's extreme sensitivity to mortgage rate volatility, with recent headlines highlighting how geopolitical events are pushing rates higher, creating a divergence between long-term regulatory tailwinds for its servicing business and near-term cyclical headwinds for its origination volumes.…
RKT
Rocket Companies
$14.40
RKT 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Rocket Companies's 12-month outlook, with a consensus price target around $18.72 and implied upside of +30.0% versus the current price.
Average Target
$18.72
3 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
3
covering this stock
Price Range
$12 - $19
Analyst target range
Analyst coverage is very limited, with only 2 analysts providing estimates, indicating this is a stock with minimal institutional research attention which can lead to higher volatility and less efficient price discovery. The consensus leans neutral, with recent institutional ratings from firms like Keefe Bruyette & Woods (upgraded to Outperform in March) and Wells Fargo (Equal Weight) showing a mixed but generally cautious stance. The target price range is not provided in the data, but the estimated EPS range for the two analysts is wide ($0.88 to $1.76), signaling high uncertainty about the company's near-term earnings power amidst a volatile mortgage rate backdrop.
RKT Technical Analysis
The stock is in a pronounced downtrend, with a 1-year price change of +18.54% but a 6-month decline of -12.70%, indicating a significant recent reversal from earlier strength. As of the latest close at $15.60, the stock is trading at approximately 64% of its 52-week range ($11.08 to $24.36), positioning it closer to the lower bound, which may suggest a potential value opportunity but also reflects persistent selling pressure and a 'falling knife' scenario. Recent momentum shows a stark divergence: the stock gained 9.17% over the past month, yet plunged -25.96% over the past three months, signaling that the recent uptick is a weak bounce within a powerful downtrend, likely a temporary mean reversion rather than a sustainable reversal. Key technical support is the 52-week low of $11.08, while resistance is the 52-week high of $24.36; a sustained breakdown below $11.08 would signal a new leg down, whereas reclaiming the $20 level is needed to suggest stabilization. The stock's beta of 2.357 indicates it is over 135% more volatile than the broader market (SPY), which is critical for risk management as it amplifies both gains and losses in volatile rate environments.
Beta
2.36
2.36x market volatility
Max Drawdown
-42.5%
Largest decline past year
52-Week Range
$11-$24
Price range past year
Annual Return
+11.3%
Cumulative gain past year
| Period | RKT Return | S&P 500 |
|---|---|---|
| 1m | +6.7% | +12.6% |
| 3m | -30.7% | +2.5% |
| 6m | -13.6% | +4.3% |
| 1y | +11.3% | +28.4% |
| ytd | -27.6% | +4.3% |
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RKT Fundamental Analysis
Revenue growth is volatile and currently decelerating on a sequential basis, with Q4 2025 revenue of $2.497 billion representing a strong 36.04% year-over-year increase but a significant drop from the $1.83 billion in Q4 2024; the multi-quarter trend shows revenue swinging from $1.10 billion in Q1 2025 to $2.50 billion in Q4 2025, indicating extreme cyclicality tied to mortgage volumes. Profitability is inconsistent, with the company reporting a net income of $68 million in Q4 2025 (net margin of 2.72%) but a trailing twelve-month net loss as indicated by negative EPS of -0.0027; gross margin remains high at 91.57%, but operating margin is a thin 8.72%, reflecting the high-cost structure of the mortgage business where profitability is highly leveraged to volume. The balance sheet shows a strong current ratio of 16.62 and zero debt-to-equity, indicating robust liquidity and no financial leverage risk; however, free cash flow is deeply negative at -$4.07 billion TTM and operating cash flow was -$1.23 billion in Q4 2025, revealing the company is burning substantial cash to fund operations and likely dependent on its balance sheet to weather the downturn.
Quarterly Revenue
$2.5B
2025-12
Revenue YoY Growth
+0.36%
YoY Comparison
Gross Margin
+0.87%
Latest Quarter
Free Cash Flow
$-4.1B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is RKT Overvalued?
Given the trailing net income is negative (EPS -0.0027), we lead with the Price-to-Sales (PS) ratio for valuation. The trailing PS ratio is 3.72x, while the forward PS is not explicitly provided but can be inferred from analyst revenue estimates; the EV/Sales ratio of 10.45x is significantly higher, reflecting the company's debt-free balance sheet. Compared to industry averages, data is not available in the provided dataset for a direct sector PS comparison; however, a PS of 3.72x for a cyclical mortgage originator with negative cash flow and inconsistent profitability appears rich unless pricing in a sharp recovery in earnings. Historically, the stock's own PS ratio has fluctuated wildly, from a low near 0.56x in late 2022 to a high of 21.91x in Q4 2025; the current 3.72x is below the recent peak but above the troughs seen during prior downturns, suggesting the market is pricing in a moderate recovery but not extreme pessimism.
PE
-376.5x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range -340x~355x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
35.5x
Enterprise Value Multiple
