RKT Stock Forecast & Price Target

Rocket Companies has demonstrated a robust potential for growth, particularly following its acquisition of the Mr. Cooper Group, which positions it as the largest mortgage servicer in the U.S. The company is expected to realize substantial merger synergies, with guidance indicating up to $500 million through 2027, which, if surpassed, could drive an investment-grade rating from major ratings agencies, thereby enhancing the overall financial stability and valuation outlook. Additionally, with a projected FY26 EPS of $0.60, the potential for an elevated earnings multiple exists, especially in response to improving refinancing trends and increased operational efficiencies driven by the combined entity's scale and technology capabilities.

The financial outlook for Rocket Companies is negatively impacted by rising mortgage rates, which could adversely affect earnings if consumer credit and housing conditions weaken. Following the merger with Mr. Cooper Group, the company has experienced a stock decline of 25% since its peak in mid-September, with ongoing concerns about potential volatility in stock valuations if rate cut expectations are adjusted due to inflation. Additionally, there is uncertainty regarding mortgage rate stabilization below the critical 6% threshold, which could hinder new origination activity and ultimately affect the company's profitability.