Analyzing Rocket Companies (RKT) and Its Peers

Rocket Companies (NYSE:RKT) is one of 19 public companies in the “FIN – MTG&REL SVS” industry, but how does it contrast to its competitors? We will compare Rocket Companies to similar businesses based on the strength of its dividends, analyst recommendations, risk, profitability, earnings, institutional ownership and valuation.

Profitability

This table compares Rocket Companies and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rocket Companies	0.06%	3.61%	1.27%
Rocket Companies Competitors	-5.93%	-85.16%	-0.75%

Volatility and Risk

Rocket Companies has a beta of 2.28, indicating that its share price is 128% more volatile than the S&P 500. Comparatively, Rocket Companies’ competitors have a beta of 1.33, indicating that their average share price is 33% more volatile than the S&P 500.

Institutional and Insider Ownership

4.6% of Rocket Companies shares are owned by institutional investors. Comparatively, 52.2% of shares of all “FIN – MTG&REL SVS” companies are owned by institutional investors. 92.6% of Rocket Companies shares are owned by company insiders. Comparatively, 30.3% of shares of all “FIN – MTG&REL SVS” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Rocket Companies and its competitors top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Rocket Companies	$4.59 billion	$29.37 million	-461.07
Rocket Companies Competitors	$18.33 billion	$1.82 billion	-67.67

Rocket Companies’ competitors have higher revenue and earnings than Rocket Companies. Rocket Companies is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Rocket Companies and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rocket Companies	2	9	1	0	1.92
Rocket Companies Competitors	154	682	989	15	2.47

Rocket Companies presently has a consensus price target of $14.46, indicating a potential upside of 4.53%. As a group, “FIN – MTG&REL SVS” companies have a potential upside of 22.58%. Given Rocket Companies’ competitors stronger consensus rating and higher possible upside, analysts plainly believe Rocket Companies has less favorable growth aspects than its competitors.

Dividends

Rocket Companies pays an annual dividend of $1.28 per share and has a dividend yield of 9.3%. Rocket Companies pays out -4,273.3% of its earnings in the form of a dividend. As a group, “FIN – MTG&REL SVS” companies pay a dividend yield of 3.1% and pay out 45.4% of their earnings in the form of a dividend. Rocket Companies is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Summary

Rocket Companies competitors beat Rocket Companies on 8 of the 15 factors compared.

About Rocket Companies

Rocket Companies, Inc., a fintech holding company, provides mortgage lending, title and settlement services, and other financial technology services in the United States and Canada. It operates through two segments, Direct to Consumer and Partner Network. The company’s solutions include Rocket Mortgage, a mortgage lender; Amrock that provides title insurance, property valuation, and settlement services; Rocket Homes, a home search platform and real estate agent referral network, which offers technology-enabled services to support the home buying and selling experience; and Rocket Loans, an online-based personal loans business. It also offers Core Digital Media, a online marketing platform in the mortgage and personal financial product sectors; Rocket Money, a personal finance app that helps clients manage every aspect of their financial lives; Lendesk, a software services company that provides a point of sale system for mortgage professionals and a loan origination system for private lenders; Rock Connections, a sales and support platform specializing in contact center services; and Rocket Innovation Studio that recruits and mentors top technology talent. In addition, the company originates, closes, sells, and services agency-conforming loans. Rocket Companies, Inc. was founded in 1985 and is headquartered in Detroit, Michigan. The company operates as a subsidiary of Rock Holdings Inc.