Rocket Companies (RKT) Moves 10.0% Higher: Will This Strength Last?

Core Viewpoint - Rocket Companies (RKT) shares experienced a significant rally of 10% due to a major acquisition announcement, which has generated bullish sentiment among analysts [1][2]. Company Summary - RKT shares closed at $13.86 after a notable trading session with higher volume, contrasting with a 6.3% loss over the previous four weeks [1]. - The company announced plans to acquire Mr. Cooper Group (COOP) for $9.4 billion, which has led to upgrades in ratings from Deutsche Bank and KBW, highlighting strong growth potential from the acquisition [2][3]. - Deutsche Bank upgraded RKT's rating to Buy from Hold and raised the price target from $14 to $16, while KBW upgraded it to Market Perform from Underperform, both analysts believing the acquisition will enhance RKT's market position and long-term growth [3]. Earnings Expectations - RKT is expected to report quarterly earnings of $0.05 per share, reflecting a year-over-year increase of 25%, with revenues projected at $1.25 billion, a decrease of 9.6% from the previous year [4]. - The consensus EPS estimate for RKT has been revised 11.3% lower over the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [5]. - The stock currently holds a Zacks Rank of 3 (Hold), while Velocity Financial (VEL), a competitor in the same industry, has a Zacks Rank of 1 (Strong Buy) [5][6].