Rocket Companies, Inc. (RKT): A Bull Case Theory

We came across a bullish thesis on Rocket Companies, Inc. on Value Degen’s Substack’s Substack by Unemployed Value Degen. In this article, we will summarize the bulls’ thesis on RKT. Rocket Companies, Inc.'s share was trading at $20.31 as of December 1st. RKT’s trailing and forward P/E were 285.43 and 25.00 respectively according to Yahoo Finance.

Rocket Companies (RKT) has seen strong early success following its acquisition of Redfin, with integration results exceeding expectations. Within just three months, the share of Redfin homebuyers obtaining a Rocket mortgage has more than doubled from 5% to 11%, and management expects this figure to surpass 20% within the next 18 months. The acquisition appears to be an excellent strategic fit, driving meaningful synergy and deepening Rocket’s access to digital homebuyers.

Simultaneously, Rocket’s home equity loan volumes have doubled year over year, underscoring a shift in consumer behavior. Despite elevated interest rates limiting cash-out refinancing activity, home equity loans are gaining traction—particularly among Baby Boomers tapping their paid-off homes for renovation and remodeling projects. This structural shift positions Rocket favorably to capture strong demand over the next two years as homeowners leverage built-up equity rather than refinance.

From a trading perspective, the stock’s technical setup has also drawn attention. Having previously advised selling RKT near $20 and reentering around $16.50, the analyst views the stock as likely to move within an upward-trending channel, offering repeated trading opportunities.

While the long-term investment case may still be forming, short- to medium-term price action appears favorable. Overall, the Redfin integration success, combined with rising home equity activity and technical tailwinds, paints a constructive picture for Rocket Companies, with near-term catalysts rooted in execution and a shifting mortgage landscape.

Previously we covered a bullish thesis on Rocket Companies, Inc. (RKT) by Unemployed Value Degen in December 2024, which highlighted the company’s potential to benefit from a home equity loan boom. The stock has appreciated approximately 37% since our coverage as this thesis played out. The thesis still stands, as Unemployed Value Degen shares a similar view but emphasizes Redfin integration success and home equity momentum.

Rocket Companies, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 56 hedge fund portfolios held RKT at the end of the second quarter which was 44 in the previous quarter. While we acknowledge the risk and potential of RKT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RKT and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.