KBW Sees Limited GSE Cap Impact on Rocket (RKT), Maintains Market Perform

Rocket Companies Inc. (NYSE:RKT) is one of the most shorted stocks right now. While the recent acquisitions of Mr. Cooper Group Inc. (NASDAQ:COOP) and Redfin are seen as a strategic fit, the 58% rally in 2025 has left the valuation relatively fair.

On this note, analysts from Keefe, Bruyette & Woods (KBW) reiterated a Market Perform rating on August 27, with a $15 price target on Rocket Companies (NYSE:RKT) following the Government-Sponsored Enterprises’ (GSEs) approval of its acquisition of COOP. As part of the approval, regulators imposed a 20% cap on GSE servicing market share.

The combined Rocket–COOP entity currently holds about a 13% share of owned GSE servicing, which suggests further room for expansion within the cap. However, when we factor in subservicing, the combined share could approach or exceed the threshold, potentially requiring adjustments to Rocket Companies Inc.’s (NYSE:RKT) servicing mix. The analysts noted that any such changes are unlikely to affect earnings meaningfully, as subservicing is less profitable than owned servicing.

Overall, the analysts see limited earnings impact from the regulatory conditions, though they view the market share cap as a constraint on long-term growth flexibility.

Rocket Companies Inc. (NYSE:RKT) is a U.S.-based fintech company best known for Rocket Mortgage, one of the nation’s largest mortgage lenders. The company also operates in real estate and financial services, with a focus on streamlining consumer lending through its digital platforms.

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Disclosure: None. This article is originally published at Insider Monkey.