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Rocket stock trading stopped several times on Tuesday.
Emily Elconin / Bloomberg
Rocket companies
shares rose as much as 75% on Tuesday as the mortgage maker became the last of the much-reduced shares to reduce short-term sellers.
Rocket stock trading (ticker: RKT) stopped three times due to volatility on Tuesday. Shares closed at $ 41.60 for a gain of 71.2%. The company is one of the shortest stocks on Wall Street, with 39.7% short float.
The rise in shares comes as a result of Rocket’s fourth-quarter earnings last week. Rocket said it obtained new loans worth $ 107 billion in the quarter, surpassing the guidelines that required between $ 88 and $ 93 billion in origination. The mortgage company also declared a special dividend of $ 1.11 per share.
The company’s shares have been a popular topic
Twitter
and Reddit’s WallStreetBets, the message board at the center of GameStop’s frenzy, until late.
“Rocket Mortgage, why did you sell 38% of this company in the short term?” tweeted Jim Cramer from CNBC Mad Money shortly after 2 p.m. Tuesday. “It’s a very solid company, it may not be your favorite if rates soar, but it’s very well managed.”
Ihor Dusaniwsky, managing director of predictive analytics at S3 Analytics, compared Rocket’s price and short-term sales activity to recent trading in
GameStop
(GME), MarketWatch reported earlier Tuesday.
Rocket went public last summer in what was one of the largest IPOs of the year. At Monday’s close of $ 24.30, the stock had gained about 35% of its $ 18 IPO price. The first conversation between analysts revolved around whether Rocket, which originates home and car loans through a digital platform directly to the consumer, should be valued as a mortgage maker — a company sensitive to fluctuations. of mortgage rates — or a technology company with growth potential. .
As of Tuesday, the 14 analysts covering Rocket shares have an average target price of $ 24.64 and an average Hold rating, according to FactSet.
With the spectrum of higher mortgage rates – the average 30-year fixed-rate mortgage rose last week due to rising Treasury yields – Rocket management said demand remains strong in the market real estate and that rates are still low enough to justify refinancing millions.
“Rates will go up and rates will go down,” Jay Farner, CEO of Rocket Companies, said in the company’s earnings call. “Our real focus is to make sure we deliver an experience that draws customers and consumers into our conversion funnel and allows us to grow market share.”
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