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Rocket trading was stopped several times on Tuesday.
Emily Elconin / Bloomberg
Missile companies
shares rose to 75% on Tuesday as the mortgage maker became the latest short-circuited stock that squeezed sellers into default.
Rocket trading (ticker: RKT) was stopped three times due to volatility on Tuesday. The stock closed at $ 41.60 for a gain of 71.2%. The company is one of the shortest shares on Wall Street, with 39.7% of the short float.
The increase in shares is due to the gains earned by Rocket in the fourth quarter last week. Rocket said it made new loans worth $ 107 billion in the quarter, exceeding the $ 88 billion to $ 93 billion in initiation guidelines. 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 the GameStop frenzy, until late.
“Rocket Mortgage – why was 38% of this company sold short?” Jim Cramer wrote on Twitter on CNBC Crazy money shortly after 2 p.m. Tuesday. “It’s a really solid company, it may not be your favorite if rates go up, but it’s so well run!”
Ihor Dusaniwsky, general manager of predictive analytics at S3 Analytics, compared the Rocket price and short selling activity with recent trading in
GameStop
(GME), MarketWatch reported earlier Tuesday.
Rocket went public last summer in what was one of the biggest IPOs of the year. At Monday’s close of $ 24.30, the stock gained about 35% of the $ 18 IPO price. The early conversation between analysts revolved around whether Rocket, which is based on car and car loans using a digital platform directly to the consumer, should be valued as a mortgage issuer – a company sensitive to fluctuating 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.
Given the spectrum of higher mortgage rates – the average 30-year fixed-rate mortgage rose last week following a rise in Treasury yields – Rocket Management said demand remains strong in the real estate market and rates are still high enough. to justify refinancing for millions.
“Rates will rise and rates will fall,” Rocket Companies CEO Jay Farner said of the company’s earnings call. “Our real goal is to make sure we offer an experience that draws customers and consumers into our funnel and allows us to increase market share.”
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