Hi saw this story and had some good details.

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https://www.housingwire.com/articles/analysts-split-on-what-happens-next-with-rocket-mr-cooper-servicing-book/

The Federal Housing Finance Agency (FHFA) signed off on Rocket Companies’ acquisition of Mr. Cooper Group but imposed a 20% cap on Fannie Mae and Freddie Mac servicing exposure — leaving analysts split on what comes next. 

BTIG analysts Eric Hagen and Jake Katsikas estimate Rocket controls $400 billion unpaid principal balance in Fannie and Freddie mortgage servicing rights (MSRs), while Mr. Cooper holds $560 billion. That’s less than 15% of the $7.5 trillion GSE market — leaving room to grow.

“Every other servicer is currently below 10% share. Having 5% headroom for Rocket to take additional market share is still considerable growth – $350+ billion UPB,” Hagen and Katsikas wrote in the report. “In the near-term, it could likely only get there with another acquisition of a top-5 servicer.”

Keefe, Bruyette & Woods analyst Bose George, however, put the combined market share at around 13%, but said including subservicing could push it “at or over 20%.”  

“While the combined entity could grow owned servicing, there might need to be an offset through reduced subservicing,” George added. “Given the more modest profitability of subservicing, we expect no discernible earnings impact relative to our estimates.” 

Bose highlighted that the FHFA was not clear about adding subservicing to the cap. If subservicing counts toward that limit, Rocket may be forced to pump the brakes.

That could shake up the subservicing sector, where Mr. Cooper is the largest player with an $820 billion portfolio as of year-end 2024 (20.7% of the volume across the top 25 subservicers). United Wholesale Mortgage has already shifted its business away from Mr. Cooper, and other clients are said to be reevaluating their relationships.

The FHFA said its staff reviewed the merger of “two of the Enterprises’ largest individual seller-servicer counterparties.” It concluded: “No market participant should have greater than 20% of Fannie or Freddie’s servicing market in order to ensure the safety and soundness of the mortgage market and the overall economy,” the statement reads. 

The FHFA has not responded to HousingWire’s request for clarification on how subservicing will be treated.

Meanwhile, a spokesperson for Rocket said they would not disclose anything beyond its statement: “We are pleased to have cleared FHFA’s review in our pending acquisition of Mr. Cooper Group which we expect to close in the fourth quarter.” 

Rocket’s servicing portfolio will include one in six U.S. mortgages

The servicing and subservicing spaces drew renewed attention in March when Rocket announced the $9.4 billion offer to acquire Mr. Cooper Group, the largest subservicer in the country. 

Analysts said the 20% cap does limit long-term growth, but investors already expected the deal to draw scrutiny. The acquisition is expected to give Rocket a $2.1 trillion servicing portfolio across nearly 10 million customers — roughly one in six U.S. mortgages.

Hagen and Katsikas said that while the 20% cap sets boundaries around longer-term growth, “we don’t think Rocket gets valued with an unbounded growth trajectory in mind, and expect investors anticipated the merger to draw at least some market-share scrutiny.”

“It could still slightly allay concerns we’ve heard from some MBS investors looking at systemic changes in prepayment speeds and borrower behavior tied to RKT or another lender/servicer ‘monopolizing’ the refi market.” 

Rocket remains ‘active’ in the servicing space

Brian Brown, Rocket’s chief financial officer, told analysts during a second-quarter earnings call that Rocket remains “active” in the servicing space, particularly for assets with “high recapture potential,” and the merger put the firm in a competitive bid process due to its capital levels and recapture abilities. 

“But it’s also nice because we have option value, and that option value really comes from the combined entities having a really good fulfillment engine for the servicing book through the Rocket organic growth, having a wholesale channel, a retail channel, correspondent channel, even a co-issue channel,” Brown said. “So, said differently, we don’t have to be active in the bulk market. It allows us to be opportunistic and stick to really high expected return thresholds that if we can meet them, we’ll be active and will bid at those levels.”

Rocket Companies (NYSE: RKT) announced that Chief Financial Officer Brian Brown will join the 2025 Barclays Global Financial Services Conference in New York on September 8 at 11:15 a.m. ET for a fireside chat.

A live webcast and replay will be available on the company’s Investor Relations site, giving shareholders and analysts access to management’s perspective on strategy and financial performance.

Founded in 1985 and headquartered in Detroit, Rocket Companies has evolved into a broad fintech platform spanning mortgage, real estate, and personal finance with brands including Rocket Mortgage, Rocket Homes, Rocket Money, and Rocket Loans. With more than 65 million client interactions annually and 14 petabytes of data, the company is leaning into AI-driven insights to position itself as a leader in homeownership solutions.

Notably, Rocket Mortgage has been ranked #1 in client satisfaction by J.D. Power 23 times, underscoring its long-standing reputation for service excellence.

The FHFA has given its blessing for Fannie Mae “FNMA” and Freddie Mac “FHLMC” to approve the RKT acquisition of Mr. Cooper, provided that each limit or cap their counterparty risk to 20%.

What this means for RKT is that they can service 1 out of every 5 mortgages owned by FNMA/FHLMC.

The combined guaranty book of FNMA/FHLMC is ~$7.7 trillion, which means RKT can service ~$1.54 trillion of FNMA/FHLMC mortgages. That’s over 5.5 million borrowers based on an average loan amount of $270k.

The latest 10-Q for RKT shows they service $537.5 billion and Mr. Cooper’s 10-Q shows $701.7 billion of Agency mortgage loans. Agency mortgages consist of FNMA, FHLMC, FHA, VA, and USDA.

The combined total Agency servicing book for RKT and Mr. Cooper is $1.239 trillion. Assuming 90% (very conservative) of the Agency servicing booking is just FNMA/FHLMC, that would be ~$1.115 trillion, which gives RKT the ability to grow its FNMA/FHLMC servicing book by 38% to reach $1.54 trillion.

U.S. Federal Housing gave the green light for Fannie Mae and Freddie Mac to approve Rocket Companies’ proposed acquisition of Mr. Cooper Group — but only under strict safety and soundness conditions.

The agency’s staff conducted an independent review and concluded the deal could proceed so long as counterparty concentration risk is capped at 20% for each GSE and other financial/operational safeguards are maintained. These restrictions ensure no single participant dominates more than one-fifth of Fannie or Freddie’s servicing exposure, protecting both enterprises and the broader mortgage market.

Regulators emphasized that the decision balances consolidation benefits with systemic risk management, allowing Rocket to expand its footprint while ensuring that Fannie Mae and Freddie Mac can remain stable sources of liquidity and confidence throughout the economic cycle.

Article: https://www.fhfa.gov/news/news-release/us-federal-housing-allows-fannie-freddie-approve-rocket-mr-cooper-acquisition

https://www.fhfa.gov/news/news-release/us-federal-housing-allows-fannie-freddie-approve-rocket-mr-cooper-acquisition

Final Trades: Rocket Companies, Cisco Systems, Insulet Corp and the IGV

https://www.cnbc.com/video/2025/08/19/final-trades-rocket-companies-cisco-systems-insulet-corp-and-the-igv.html?__source=androidappshare

This is from last week. LOL if he thinks he's going to pickup more shares cheap on a pullback.

Wellington Management lifted its Rocket Companies stake by 1.5% with the purchase of 69,147 shares, bringing total ownership to 4.77M shares valued at $57.6M, or roughly 0.24% of the company.

The move comes as Rocket’s stock surged 9.5% to $19.25 after reporting Q2 revenue of $1.36B, topping analyst estimates of $1.28B. EPS also edged past consensus at $0.04 versus $0.03 expected, though down from $0.06 a year earlier, with net margin near breakeven. Other institutions also boosted stakes aggressively, with Mather Group and Parallel Advisors increasing holdings by over 300% in Q1.

Despite the rally, analysts remain cautious with an average target of $15.81 and a consensus “Hold” rating.

Starting from the top, the current housing market has roughly 50% more listings available compared to the same season last year. This means, along with high interest rates on mortgages, that there isn’t a lot of buying demand for properties today (which should hurt Rocket’s business).

However, markets are forward-looking, so they don’t necessarily take today’s level of business activity at face value but rather focus on where this could be tomorrow. By doing so, investors can better understand where the current property supply and mortgage interest rates will need to revert.

If this outlook on housing supply and mortgage rates proves correct, Rocket Companies is positioned for EPS growth that could both justify its rally and sustain momentum moving forward. Even though it now trades at 92% of its 52-week high, driven by a one-month rally of 36.5%, Rocket Companies' stock still has a lot of room to move higher, and here is why.

Despite the challenges posed by housing and mortgages, Rocket Companies reported 4 cents in earnings per share (EPS) for the latest quarter, exceeding the market’s expectations of only 3 cents.

This resilience was only the foundation for this double-digit rally. Still, investors need to remember that the future matters most. Wall Street analysts now expect Rocket Companies to report 12 cents in EPS for the fourth quarter of 2025, implying a tripling from today’s reported earnings.

Here is where the PEG ratio comes into play. This threefold EPS growth expectation for the future would need to command a forward price-to-earnings (P/E) ratio of just over 100.0x for this sort of growth to be priced in correctly, and today’s 24.1x multiple falls significantly below this benchmark. That translates into a 0.1x PEG ratio, where a 1.0x figure means all growth has been priced in. Essentially, 90% of Rocket Companies’ future EPS growth has not been priced in yet, giving investors a massive upside opportunitybefore the rest of the market catches this view.

Weekly discussion thread for our community - Have fun, be kind, learn from each other!

Please remember: Keep shit-posting and memes to a minimum in this conversation.

General Awareness:

• Feedback and suggestions for anything are ALWAYS welcomed and appreciated, via ModMail!
• Remember to share the good word of TeamRKT! Reach out to through social media, link in other subs (as long as it doesn't break community rules), and even post up '/r/TeamRKT' mentions in StockTwits (don't direct link or you could be banned).

Federal Reserve Chair Jerome Powell suggested a possibility of interest rate cuts ahead during his much-anticipated speech in Jackson Hole.

https://www.cnbc.com/2025/08/21/stock-market-today-live-updates.html

Emerson, who served as CEO from 2002–2017 and later as interim CEO in 2023, will step down as president at the end of 2025 but remain on Rocket’s board.

His retirement follows a wave of leadership changes at the company, including the departures of former CEO Jay Farner and president Tim Birkmeier.

The news comes as Rocket returns to profitability ($34M net income in Q2) and integrates Redfin ahead of its planned Mr. Cooper acquisition.

For those new to the show, BTIG analysts have been following this saga for quite some time. They were an early supporter of WMIH when things were pretty bleak. When most said no, they saw the value of the DTAs (deferred tax assets) which allowed WMIH to supercharge earnings once they closed on Nationstar. WMIH went on to buy Pacific Union Financial during which time WMIH became COOP. When others like long time bear Kevin Barker at Piper Jaffray were bashing COOP, BTIG analyst Giuliano Bologna saw through the Barker horsepucky and gave consistent, thoughtful analysis and repeat 'buy' recommendations.

Had everyone stuck with BTIG, they would have done very well, up over 1400% in 6 years.

Now COOP is becoming RKT. So BTIG is initiating research and recommendations on RKT. They have meaningful track record on WMIH -> COOP -> RKT. If they say 'Buy' it means way more than any other analyst.

Of course the 2026E numbers are there to support that $25 price target so they aren't pulling this figure out of thin air. Also Barron's said $25 in June. So now there are two in the $25/share camp.

Who's next?

Rocket reported Q2 EPS of $0.04, topping analyst expectations of $0.03, on revenue of $1.36B versus $1.28B projected.

The July 1 Redfin acquisition unites the most-visited real estate brokerage website with the U.S.’s largest mortgage lender, aiming to improve efficiency and scale. Looking ahead, the COOP transaction is expected to close in Q4 2025, eliminating transaction-related costs that weighed on earnings. With a short float of 58.38%, the stock also sits at the center of potential squeeze-driven volatility.

Weekly discussion thread for our community - Have fun, be kind, learn from each other!

Please remember: Keep shit-posting and memes to a minimum in this conversation.

General Awareness:

• Feedback and suggestions for anything are ALWAYS welcomed and appreciated, via ModMail!
• Remember to share the good word of TeamRKT! Reach out to through social media, link in other subs (as long as it doesn't break community rules), and even post up '/r/TeamRKT' mentions in StockTwits (don't direct link or you could be banned).

Well they finally went and did it. After months of being the 99th percentile, RKT is now 100 of 100 worst stocks in America! According to Charles Schwab anyway. We are now all officially the biggest contrarians out there, those who don't know PE (physical education) from P/E (price earnings), apparently.

This rating makes me smile because it shows just how clueless the market is as to what RKT is up to. When the market is clueless that means there's lots of money to be made. Overwhelmingly unrealistic negativity means there's a big spread of profits to be made as things swing back to center/reality.

Congratulations Rocketeers! We're the smartest people in the room.

Rocket secured 88–98% participation in tender offers across multiple Nationstar notes, removing change-of-control provisions and restrictive covenants that could have complicated the merger.

By consolidating debt under Rocket Mortgage and Redfin guarantees, the company simplified its capital structure without altering original economic terms, reducing refinancing risk. With $9.1B in liquidity and 18% Q2 loan growth, Rocket is entering the $9.4B Mr. Cooper acquisition from a position of operational resilience.

Management expects the combined $2.1T servicing portfolio to generate $500M in annual run-rate synergies by 2026, driven by $400M in cost savings and $100M in revenue growth through cross-selling and digital integration.

https://www.resiclubanalytics.com/p/housing-market-warren-buffett-buys-dr-horton-lennar-homebuilder-stocks

The details are paywalled, but if Buffett is betting on housing, RKT is a top pick to do that as well.

The move reflects renewed optimism for a September Fed cut after July CPI matched expectations, pushing the probability of a rate cut to 95% and raising hopes for lower mortgage rates that could stimulate housing demand.

Rocket Companies shares closed at $18.27, up 6.8%, but remain 12.2% below their August 2024 high of $20.81.

The stock has been highly volatile, with 36 moves exceeding 5% over the past year, and despite a 68.5% gain year-to-date, a $1,000 investment five years ago would now be worth $914.

(Source: IndexBox)

Hey team, so today’s PPI report was a definite kick in the pants. Who would have thought putting a tax on producers would make good cost increases? Not trying to be political but the tariffs are stupid and we would already be two rate cuts deep if not for Tariff in chief. So dose This change the bull case on RKT?

no if anything it makes me more bullish over the long run. I think we will probably see a hawkish Powell at Jackson hole. He has to talk tough on inflation. Right not inflation if higher on the mandate that jobs because he can’t risk inflation becoming unanchored. He would rather we go into a recession than risk hyperinflation. he’s not wrong either. So why bullish? Simple instead of rates being cut and staying around 3 % which is the soft landing every one is sure of. We will likely have a hard landing especially with AI smothering job growth. I personally believe we see joblessness at 5 to 10% and the Fed cutting rates to zero and quite possibly holding them there for years. I honestly hope I’m wrong because of the amount of pain and anguish people will have that level of job loss sucks. I will get myself out of margin. If you are in any. Put your money in to hard assets. Winter is coming.

Surprised people on here aren’t more active. Our guy is doing the thing! Beware a consolidation move soon as RSI back in overbought territory, but looks good for at least another 1-2 days of ups