Rocket Companies stock has been growing significantly since its initial public offering (IPO) in August 2020.
Rocket Companies Inc (NYSE: RKT) recorded more than 70% gain in its stock due to increasing interest from day traders on Reddit WallStreetBets chat room on the 2nd of March. On the day, the company’s shared closed trading with a 71.2% rise to $41.60. However, RKT stock has declined to $38.20 in the after-hours trading. The current trading price is a loss of more than 8% over its previous close.
Online mortgage provider and parent company of Quicken Loans, Rocket Companies, had the busiest trading day ever amid volatility. As a result of the volatility, the company’s stock was halted from trading several times. During the busy-day trading, trading volume was 306.4 million shares, compared with the full average of about 13 million shares recorded over the past 30 days.
Currently, the company has large short bets placed against it by hedge funds. According to FactSet, about 40% of its available shares have been sold short.
Barclays analyst Mark Devries commented on the company’s short squeeze. He said:
“This feels very much like a retail-driven move and also probably a short squeeze.”
According to the managing director of predictive analytics at S3 Partner, Ihor Dusaniwsky, the value of Rocket shares shorted was $1.2 billion when trading closed on the 1st of March. This represents about 46% of the float, compared with 35.5% recorded at the beginning of the past month.
Now, Rocket Companies is the fifth-largest short in the banking sector. Data by S3 revealed that other companies ahead of Rocket Companies are JPMorgan Chase & Co. (NYSE: JPM) and Citigroup (NYSE: C).
Rocket Companies Stock
Rocket Companies stock has been growing significantly since its initial public offering (IPO) in August 2020. As noted by MarketWatch, the company’s stock has risen by 105.74% in its year-to-date record. The company has surged more than 106% in the last three months and nearly 99% over the past month. In the last five days, Rocket Companies has spiked 108%.
The recent rally makes Rocket Companies one of the stocks that rose in reaction to the buzz generated from Reddit’s WallStreetBets. Reuters noted that Rocket Companies saw an increase from $34 billion to $82.6 billion in its market capitalization as the mentions of the companies on Reddit’s WallStreetBets have multiplied over the past days. One of the posts on the WallStreetBet said:
“I like RKT. $1.7 M all-in, let’s gooo YOLO.”
The post gained attention within minutes with more than 1,700 comments.
At the time of writing, however, MarketWatch data showed that Rocket Companies has a market value of $48.22 billion.
In addition, a Jefferies analyst Ryan Carr had upped his price target on Rocket Companies. On the 25th of February, Carr raised his price target on the company from $27.50 to $30. The increase came after Rocket Companies reported a profitable fourth-quarter earnings result, beating Wall Street’s expectations.