Rocket Companies Is Down 66% Since Going Public. Is It Time to Buy the Dip?

Since going public in August of 2020, Rocket Companies (NYSE: RKT), the largest mortgage originator in the country, has been a disaster, with its stock price down close to 66%. The company went public during an ultra-low interest rate environment and took full advantage of the refinancing boom as people rushed to lock in at low mortgage rates. But inflation surged, forcing the Federal Reserve to set aggressive expectations for raising its benchmark overnight lending rate, which has sent mortgage rates soaring at the fastest pace in 40 years, putting a swift end to the refinancing boom. Rocket's stock has not fared well and now trades at less than $9 per share. Is it time to buy the dip?

Rocket is largely in the business of originating as many mortgages as possible and then selling the loans for a fee. It's a difficult business because there is lots of competition in the industry, and it can be difficult to stand apart outside of pricing.

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Source Fool.com