Rocket Companies: Riding Rate Relief and Policy Tailwinds into 2026
Rocket Companies has evolved into a true innovator in the mortgage and fintech space, demonstrating resilience and adaptability through multiple rate cycles.
Over the past year, Rocket has staged a meaningful recovery as shares rose more than 80%. This performance outpaced many peers in the lending space, reflecting renewed investor confidence in Rocket’s digital platform and market-leading position.
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In a lower interest-rate environment that’s gaining momentum, combined with supportive housing policies from the Trump administration, Rocket remains an appealing opportunity for those seeking exposure to a potential mortgage market rebound.
The Reasons Behind Rocket’s Rise
Rocket’s ascent in 2025 was rooted in improving fundamentals amid shifting rate expectations. After a challenging period in prior years marked by elevated interest rates that suppressed originations and refinancing activity, the Federal Reserve’s pivot toward rate cuts in late 2024 began unlocking pent-up demand.
As one of the nation’s largest mortgage originators with its tech-driven platform (Rocket Mortgage), Rocket benefited disproportionately. Gain-on-sale margins expanded as volumes grew, while the company’s servicing portfolio—valuing retained mortgage servicing rights (MSRs)—provided a hedge through recurring revenue.
Key to the stock’s momentum was Rocket’s operational efficiency and diversification. Investments in AI and automation reduced customer acquisition costs and streamlined underwriting, enabling market share gains even in a subdued environment. The personal loans and home equity segments added growth layers, while partnerships expanded reach.
By the third quarter of last year, adjusted revenue surged, and the company returned to consistent profitability—validating management’s focus on unit economics.
The lower interest-rate path has been a primary catalyst. As 30-year mortgage rates declined from peaks above 7% to the mid-5% range by early 2026, refinancing activity accelerated—Rocket’s specialty, given its digital speed and scale. Purchase volumes also stabilized as affordability improved slightly. Analysts project this trend continuing, with potential for rates in the low-5% or even 4% range if Fed easing persists and inflation moderates.
Tailwinds in 2026 Suggest More Room to Run
Adding a significant boost is the Trump administration’s recent housing initiatives. In January 2026, President Trump directed Fannie Mae and Freddie Mac to purchase up to $200 billion in mortgage-backed securities, aimed at directly lowering borrowing costs and enhancing affordability.
This move, part of broader plans to stimulate homeownership—including limits on institutional investor purchases—has already tightened MBS spreads and contributed to rate declines. For Rocket, this policy support could supercharge origination volumes, as lower rates unlock the “rate lock” effect where homeowners refinance or buyers enter the market.
These dynamics create a virtuous cycle: Increased activity boosts gain-on-sale income short-term, while new servicing rights enhance long-term recurring revenue. Rocket’s scale—originating over $100 billion annually in peak years—positions it to capture a disproportionate share.
What the Zacks Model Reveals
Currently, Rocket Companies RKT carries a Zacks Rank #3 (Hold), reflecting balanced expectations amid improving sentiment. Rocket delivered a trailing four-quarter average earnings surprise of over 35%, showcasing its ability to consistently overdeliver.
The upcoming Q4 2025 results, expected in late February, carry consensus EPS around $0.09 (a notable swing from prior losses) on revenue near $2.3 billion. These figures represent year-over-year advances of 125% and 92.4%, respectively.
The Zacks Earnings ESP (Expected Surprise Prediction) indicator seeks to find companies that have recently seen positive earnings estimate revision activity. This more recent information has proven to be very useful in finding positive earnings surprises, giving investors a leg up during earnings season. In fact, when combining a Zacks Rank #3 or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time according to our 10-year backtest.
RKT stock boasts a +16.28% Earnings ESP. Another beat may be in the cards when the company reports its Q4 results in about a month from now.
Bottom Line
Risks like prolonged high rates persist, but the combination of organic drivers and policy catalysts provides asymmetry. Mortgage leaders like Rocket tend to thrive in rate-down cycles, rewarding patient investors.
Rocket’s journey illustrates how innovation and timing can align for meaningful upside. For diversified portfolios, it offers sincere participation in the housing recovery without excessive speculation.
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Rocket Companies, Inc. (RKT) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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