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

We came across a bullish thesis on Rocket Companies, Inc. on Stock Analysis Compilation’s Substack. In this article, we will summarize the bulls’ thesis on RKT. Rocket Companies, Inc.’s share was trading at $17.83 as of August 18^th. RKT’s trailing and forward P/E were 213.22 and 89.29 respectively according to Yahoo Finance.

Rocket Companies has emerged as a transformative force in the mortgage industry, using technology and a strategic all-stock acquisition of Mr. Cooper to build a dominant position across both origination and servicing. Rocket has consistently gained share in the fragmented origination market, with 12% in refinance and 4% in purchase originations, supported by leading efficiency metrics. While most originators take 45 days to close a refinancing loan, Rocket averages just 20 days, with more than half of loans now closing in under 15 days.

This speed advantage, enabled by continuous reinvestment in automation, highlights its structural edge. Mr. Cooper, the largest mortgage servicer with an 11% market share, further strengthens this platform. Its cost-to-service has fallen nearly 50% over five years, making it a key beneficiary of servicing rights sales from weaker peers under pressure in the high-rate environment. The merger of Rocket and Mr. Cooper creates a powerful ecosystem where servicing directly feeds origination, supported by Rocket’s industry-leading refinance recapture rate of ~85%, more than three times the industry average.

This integrated model challenges the traditional economics of the mortgage market, reducing costly customer reacquisition and creating durable competitive advantages. Beyond the combination’s inherent synergies, Rocket is leveraging AI to automate core workflows such as income and credit verification, further enhancing throughput, conversion, and customer experience. These efficiency gains not only improve profitability but also enable lower pricing for consumers, reinforcing share gains. Together, Rocket and Mr. Cooper position the company as a uniquely advantaged consolidator with significant upside potential.

Previously we covered a bullish thesis on Rocket Companies, Inc. (RKT) by Unemployed Value Degen in December 2024, which highlighted the company’s resilience amid revenue declines, potential from a home equity loan boom, and tech-driven efficiency gains. The company’s stock price has appreciated approximately 25% since our coverage. The thesis still stands as Rocket remains well-positioned to capture share. Stock Analysis Compilation shares a similar view but emphasizes the transformative Mr. Cooper acquisition.

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Disclosure: None.