Rocket Companies (NYSE:RKT) Posts Earnings Results, Beats Expectations By $0.01 EPS

Rocket Companies (NYSE:RKT) issued its quarterly earnings data on Thursday. The company reported $0.15 EPS for the quarter, topping analysts’ consensus estimates of $0.14 by $0.01, FiscalAI reports. Rocket Companies had a net margin of 4.70% and a return on equity of 5.13%. The business had revenue of $2.57 billion for the quarter, compared to analysts’ expectations of $2.58 billion. During the same quarter last year, the company earned $0.07 EPS. The business’s revenue was up 37.4% on a year-over-year basis.

Here are the key takeaways from Rocket Companies’ conference call:

• Rocket grew market share and expanded profitability despite a difficult mortgage market, reporting $2.6 billion in adjusted revenue, $748 million in adjusted EBITDA, a 29% margin, and $0.15 in adjusted EPS. Purchase share approached 6.5% and refinance share reached 15.5%.
• The company highlighted continued strength in servicing, home equity, cash-out refinancing, and recapture. Servicing generated roughly $1 billion in quarterly fee income, while recapture reached record levels and helped support higher gain-on-sale margins.
• Rocket expects to complete the remaining $100 million of annualized Mr. Cooper expense synergies in the fourth quarter, one year ahead of schedule, and has identified an additional $100 million in savings for the first half of 2027. Record liquidity of $11.4 billion and net corporate leverage below one turn provide capacity for further investment or acquisitions.
• Management expects the fourth quarter to be materially weaker as mortgage rates remain elevated and refinance applications fall more than 50% year over year. Adjusted revenue guidance is $2.1 billion to $2.3 billion, and executives warned that the broader mortgage market could reach its lowest level in decades.

Rocket Companies Trading Up 3.1%

Shares of RKT stock traded up $0.35 on Thursday, hitting $11.92. The stock had a trading volume of 33,497,471 shares, compared to its average volume of 30,244,766. The company has a debt-to-equity ratio of 1.16, a current ratio of 4.85 and a quick ratio of 4.85. The firm has a market capitalization of $33.76 billion, a P/E ratio of 85.16, a P/E/G ratio of 3.51 and a beta of 2.23. Rocket Companies has a 1 year low of $10.18 and a 1 year high of $24.36. The company’s 50 day moving average price is $12.46 and its 200-day moving average price is $14.87.

Key Headlines Impacting Rocket Companies

Here are the key news stories impacting Rocket Companies this week:

• Positive Sentiment: Q3 earnings slightly exceeded expectations. Rocket reported adjusted EPS of $0.15 versus the $0.14 analyst consensus. Adjusted revenue was $2.57 billion, broadly in line with the $2.58 billion forecast. Rocket Companies earnings report
• Positive Sentiment: Profitability was strong on a GAAP basis. Q3 GAAP net income reached $709 million, while adjusted net income was $419 million. The results provide a positive near-term earnings catalyst despite the company’s relatively high valuation. Rocket Companies announces third-quarter results
• Positive Sentiment: Analyst expectations remain bullish. A separate report said brokerages have a consensus price target of $18.88 for RKT, substantially above the recent trading range, although price targets are not guarantees. Rocket Companies consensus price target
• Neutral Sentiment: Several articles focused on Rocket’s fintech positioning, peer comparisons, or pre-earnings expectations and did not introduce a significant new company-specific catalyst. Rocket Companies peer review
• Negative Sentiment: Q4 guidance points to a sequential slowdown. Rocket expects fourth-quarter revenue of $2.10 billion to $2.30 billion, below Q3 adjusted revenue of $2.57 billion. The outlook may temper enthusiasm from the quarterly earnings beat. Rocket Companies fourth-quarter revenue outlook
• Negative Sentiment: Housing conditions remain challenging. U.S. home-sale prices recently declined for the first time in more than three years, while mortgage payments remain near record highs. Weak affordability could reduce mortgage activity and weigh on Rocket’s core business. U.S. home-sale prices report

Analysts Set New Price Targets

A number of research analysts recently weighed in on RKT shares. JPMorgan Chase & Co. decreased their price target on shares of Rocket Companies from $14.00 to $12.50 and set a “neutral” rating on the stock in a research note on Monday, October 12th. Royal Bank Of Canada reiterated a “sector perform” rating and set a $16.00 price objective (up from $15.00) on shares of Rocket Companies in a research note on Wednesday, August 12th. Barclays reduced their target price on Rocket Companies from $17.00 to $15.00 and set an “overweight” rating for the company in a report on Monday, October 5th. Benchmark lowered their price target on Rocket Companies from $21.00 to $19.00 and set a “buy” rating on the stock in a research note on Friday, August 7th. Finally, Stephens dropped their price target on Rocket Companies from $22.50 to $20.00 and set an “overweight” rating for the company in a research report on Friday, August 7th. Eight analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the company. According to data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average price target of $18.88.

Insider Transactions at Rocket Companies

In related news, Rocket Mortgage CEO Jesse Bray sold 225,000 shares of the firm’s stock in a transaction dated Tuesday, September 15th. The stock was sold at an average price of $13.11, for a total transaction of $2,949,750.00. Following the completion of the transaction, the insider directly owned 7,953,027 shares in the company, valued at $104,264,183.97. This trade represents a 2.75% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders sold 450,000 shares of company stock worth $5,687,074. 57.68% of the stock is currently owned by corporate insiders.

About Rocket Companies

Rocket Companies, Inc is a Detroit-based financial technology company that operates a portfolio of consumer finance and real estate businesses. Its platform is designed to simplify the homeownership process through digital applications, automated workflows and online customer support.

The company’s principal business is Rocket Mortgage, a residential mortgage lender and servicer offering home purchase, refinance and home equity products. Its broader portfolio includes Rocket Homes, a real estate services platform; Rocket Money, a personal finance app that helps consumers manage subscriptions, budgets and bills; Rocket Loans, which provides personal loans; and Rocket Pro, which supports mortgage brokers and other partners.

Rocket Companies traces its history to 1985, when Dan Gilbert founded Rock Financial.