- NYSE:RKT falls a further 3.54% alongside the broader market sell-off.
- Low interest rates should see a boom for mortgage companies over the next couple of years.
- Another mortgage rival announces plans to go public via a SPAC IPO.
It has been an eventful three months for investors in NYSE:RKT, as the stock nearly doubled from its debut in early August, but has since come right back down to its starting point. On Friday, Rocket extended its week-long plummet as the stock shed another 3.54%, bringing its total weekly losses to over 11%. While the stock’s price drop has nothing to do with how the company has performed, the recency of its debut on the public markets has made it an easy one for investors to cut ties with.
Rocket’s performance has been admirable throughout the COVID-19 pandemic as its first quarterly earnings report showed a 437% year-over-year growth in its revenues at $5 billion. The company is set to release its third-quarter earnings on November 10th, and the dip in the stocks price may not have come at a better time. If Rocket can put together another strong quarter, it should see its stock price elevate off of its current lows to accurately reflect the performance of the company. With interest rates set to be low for the foreseeable future, Rocket should benefit, especially considering home sales and new mortgages have not slowed down at all during the pandemic.
RKT stock forecast
If investors missed their opportunity to scoop up some shares of Rocket Companies during its frenzied IPO debut, they can do so now at basically the same price. Industry rival United Wholesale Mortgage also recently announced its plans to debut on the public markets via a reverse merger from a SPAC IPO. Rocket remains the industry leader in mortgage origination, and the easy to use app and data analytics software should continue to provide Rocket Companies with an edge in a space that should see a boom heading into 2021.
Credit: FX Street