Redfin On The Road To Buy Rocket, Wall Street Watches Spread

Group 1: Redfin Corp and Rocket Companies Deal - JPMorgan's Dae K Lee raises Redfin Corp's RDFN stock price target from $7 to $12.50, aligning with Rocket Companies' RKT acquisition price, valuing Redfin's equity at approximately $1.75 billion, which is two times its projected 2026 revenue [1] - The market remains skeptical, with Redfin stock trading about 12% below the offer price, indicating uncertainty among investors [1][4] - The deal includes a $65.5 million termination fee and a no-shop provision, allowing Redfin to consider better offers, although Rocket's position appears strong for now [3] Group 2: Market Context and Competition - Redfin's mortgage originations were $4.6 billion in 2024, significantly lower than Rocket's $101 billion and the U.S. total of $1.7 trillion, suggesting limited impact on the mortgage market [2] - Redfin holds a 0.76% market share in the U.S. brokerage sector, which is not substantial enough to influence the overall market dynamics [2] - Zillow Group Inc faces increased competition from well-capitalized rivals like News Corp's realtor.com and CoStar's Homes.com, despite having a strong brand presence with double the average monthly unique visitors and quadruple the app daily active users compared to its closest competitor [4]