Rocket Cos Inc. (RKT) PT Lowered to $16 at Piper Sandler

Piper Sandler analyst Kevin Baker lowered the price target on Rocket Cos Inc. (NYSE: RKT) to $16.00 (from $17.00) while maintaining a Neutral rating.

The analyst commented, "We reiterate our Neutral rating and adjust our price target to $16 from $17 following 3Q24 earnings. RKT produced relatively in-line results driven by slightly higher expenses and lower gain on sale margins, offset by higher volume as RKT continues to drive further market share gains. RKT generated a +19% Q/Q increase in lock volume with gain on sale margins decreasing to 2.83% from 3.03% last quarter but above the 2.63% average in 2023. Guidance for 4Q indicates adjusted revenue to be ~15% lower than 3Q at the mid-point as management expects pressure on volumes coupled with expenses remaining elevated, partially offset by higher margins. Despite 4Q guidance being weaker than consensus estimates, we expected pressure on the quarter due to elevated rates and seasonality. While we expect earnings to move higher in 2025, we remain Neutral rated as we continue to see an extended timeline to generate 30%+ ROTE."

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