The housing market remains difficult, but one company is using the slowdown to build a much larger platform. It now connects home search, brokerage, lending, closing, servicing, and personal finance under one digital roof.
The stock still depends heavily on mortgage rates, but the business is becoming more diversified while integration savings arrive faster than expected.
Critical Minerals Bet (Sponsored)
One top fund manager put more than half of a $9 billion portfolio into a single little-known company.
Then his firm kept buying for 61 straight trading days. Now, with Washington moving to protect critical mineral supply chains through Project Vault, Whitney Tilson says
this company could be sitting on one of America’s most strategic assets.
See the critical minerals stock billionaires are watching.
What Just Happened
Earnings are the next major catalyst
Rocket Companies, Inc. (NYSE: RKT) is scheduled to report second-quarter results after the market closes on August 6.
Management previously guided for adjusted revenue between $2.7 billion and $2.9 billion. Investors will be watching mortgage volume, servicing revenue, expense reductions, Redfin lead conversion, and whether the company maintains its accelerated Mr. Cooper integration timeline.
The stock recently traded around $13.68, roughly 44% below its 52-week high. The shares have struggled as elevated mortgage rates continue to limit home sales and refinancing activity.
That weakness creates the setup. Investors are still treating Rocket primarily as a cyclical mortgage originator, while management is trying to turn it into an integrated homeownership platform with more recurring revenue and lower customer-acquisition costs.
The Transformation Is Already Visible
Q1 was dramatically larger
First-quarter net revenue rose to $2.94 billion from $1.10 billion a year earlier. Adjusted revenue reached $2.82 billion, while adjusted EBITDA jumped to $738 million from $169 million.
The company also swung from a GAAP net loss of $212 million to net income of $297 million. Adjusted EPS increased to $0.15 from $0.04.
Acquisitions account for a large portion of that growth, so the year-over-year comparison is not purely organic. Still, the numbers show the scale of the combined business and its ability to generate meaningful profit even in a difficult housing market.
Total closed mortgage volume reached $44.7 billion, more than double the prior-year level. Home equity and jumbo lending also more than doubled, expanding the product mix beyond conventional purchase and refinance loans.
What's your current take on index funds vs. active stock-picking?
Iconic Stocks At-Risk (Sponsored)
The first half of 2026 may have felt stable, but two powerful forces are now colliding.
AI is reshaping entire industries, while global trade and political alliances are becoming more fragile.
One analyst calls it The Age of Chaos.
And he believes many “safe” household-name stocks could be at risk, while a new group of companies may be positioned to lead the next market cycle.
In a free presentation, he reveals the specific stocks he believes investors should consider selling, plus the names he believes could thrive as this new era unfolds.
Stream the free presentation today and see the buy and sell list now.
*This ad is sent on behalf of Chaikin Analytics, 201 King Of Prussia Rd., Suite 650, Radnor, PA 19087. If you would like to optout from receiving offers from Chaikin Analytics please click here.
Mr. Cooper Adds A Recurring Revenue Engine
The servicing portfolio changes the model
The Mr. Cooper acquisition gave Rocket a servicing portfolio with $2.1 trillion in unpaid principal balance across 9.4 million loans.
Mortgage servicing generates fees for collecting payments, managing escrow accounts, supporting borrowers, and administering loans. Those fees are generally more recurring than revenue from originating new mortgages.
The portfolio also creates a large pool of potential future customers. When one of those homeowners wants to refinance, purchase another property, access home equity, or obtain another financial product, Rocket already has the relationship and relevant data.
That recapture opportunity can lower customer-acquisition costs and make Rocket less dependent on expensive advertising or third-party leads.
Integration is running ahead of schedule
Management originally expected to realize $400 million in Mr. Cooper expense synergies by the end of 2027. It now expects to reach the full amount by the end of 2026, one year early.
More than half of the servicing portfolio had already migrated to Rocket’s unified servicing platform by the end of Q1.
Faster integration matters because acquisition savings are central to the earnings case. The combined company carries a much larger employee base, technology infrastructure, and debt load. Removing duplicate expenses can turn that additional scale into stronger margins.
A smooth migration also gives Rocket more opportunities to use its technology and marketing capabilities across Mr. Cooper’s customer base.
Elite Trade Club Insider
Two Insiders Sold $14 Million as Their Stocks Reached New Highs
You’re looking at two companies delivering strong operating momentum while senior insiders convert major rallies into cash.
One executive sold nearly $9 million as an AI infrastructure stock broke through $300. Another insider sold approximately $5 million after an earnings beat pushed his company toward a fresh 52-week high. Insider readers are seeing which sale matters more, and where valuation has become the real risk.
You’re reading the free version. Here’s what we held back.
Every day, insiders and institutions move millions before the market catches on. We surface the data behind those moves before the rest of the market sees it.
A subscription gets you:
The insider buys, options bets, and dark pool moves the free edition can't show you. Unlocked every weekday.
A Sunday Deep Dive that tells you where to look before Monday's bell rings.
The Friday Smart Money Brief: who bought, who sold, where the big options bets landed, and where institutions are hiding volume. Three data layers. One email.
A Monthly Insider Scorecard so you always know whether smart money is buying or selling the market.
Every past Insider edition, unlocked, on elitetrade.club. Go back and see what you missed.
$25/mo or $250/yr. 30-day money back guarantee. Cancel anytime. Founding member pricing: lock in $25/mo before we raise it.
Redfin Controls The Top Of The Funnel
Search can feed mortgage demand
Redfin brings consumers into the platform before they select a home or apply for financing.
Its monthly active users increased 3.3% year over year in March, while digital purchase-mortgage leads more than tripled from the level recorded when Rocket completed the acquisition in July 2025.
That is the strategic logic behind the deal. Traditional mortgage lenders often meet customers late in the process, after a real estate agent or listing portal has already influenced the transaction.
Redfin allows Rocket to engage buyers during the search phase, then offer brokerage, mortgage, title, and closing services through one connected experience.
The more transactions Rocket keeps inside its ecosystem, the more revenue it can generate from each customer.
The early cost savings are encouraging
Rocket realized the full $140 million of planned Redfin expense synergies less than six months after closing the acquisition.
The next challenge is proving that Redfin can do more than reduce costs. Investors need to see stronger lead conversion, higher mortgage attachment rates, and a clear path toward profitable transaction growth.
A large audience is useful. A large audience that converts into mortgages and related services is much more valuable.
Grid Crisis Opportunity (Sponsored)
A growing power shortage is putting pressure on the U.S. grid just as AI data centers are demanding record amounts of electricity.
Joel Litman believes this could create serious risks for the market, but also a major opportunity for a small group of companies already helping strengthen the grid.
See how to protect your portfolio and discover the companies positioned to benefit.
AI Can Improve The Economics
Automation is supporting conversion
Rocket has invested heavily in data and artificial intelligence across search, prospecting, underwriting, servicing, and customer communication.
Its agentic AI tools now handle more top-of-funnel outreach and prescreening. Management said the technology saves loan officers roughly two hours per day and has improved conversion by double digits.
The latest AI launches added approximately $1 billion in incremental monthly mortgage volume, on top of a similar increase from earlier technology releases.
The value is not simply replacing employees. Better targeting allows loan officers to spend more time with engaged customers who are more likely to complete a transaction.
At Rocket’s scale, even a modest improvement in conversion can produce substantial additional loan volume.
Why The Stock Has A Case
The market is pricing in a difficult rate environment
Mortgage rates remain the largest external driver. High rates reduce affordability, discourage homeowners from moving, and limit refinancing demand.
RKT’s decline suggests investors expect those conditions to persist. Morgan Stanley recently upgraded the shares after arguing that the valuation already reflects mortgage rates staying around current levels and further downside to earnings estimates.
That creates potential asymmetry. If housing activity stabilizes, rates decline, or Rocket gains share despite the weak market, earnings can improve faster than the current price implies.
The business is less one-dimensional
Servicing, Redfin, Rocket Money, title and closing services, and other platform revenue make the company more diversified than it was several years ago.
Rocket Money subscription revenue reached $103 million in Q1, up from $85 million a year earlier. Real estate services contributed $192 million, while Rocket Close revenue doubled to $128 million.
Mortgage origination will remain the main earnings swing factor, but the company now has more revenue streams capable of supporting it through a weak cycle.
What Could Trip It Up
Rates are still in charge
The platform transformation does not make Rocket immune to housing conditions. If mortgage rates remain high and home sales weaken further, origination volumes and Redfin transactions will face pressure.
The share count has expanded sharply
Rocket’s diluted weighted-average share count reached approximately 2.85 billion in Q1. The increase reflects its acquisition activity and capital-structure changes.
The acquisitions can create more total earnings while still disappointing shareholders if per-share growth does not keep pace with the larger share base.
Integration is complicated
Rocket is combining three large organizations, multiple brands, millions of customers, and major technology systems. Cost savings are ahead of plan, but service disruptions or weak customer retention could damage the expected benefits.
Debt and interest costs have increased
The company recently issued $1.5 billion of senior notes to refinance existing obligations. Higher financing costs raise the importance of delivering the expected synergies and maintaining strong liquidity.
My Take
Buy on pullbacks. Rocket now controls a rare combination of home search, brokerage, mortgage origination, closing, servicing, and personal-finance capabilities. The $2.1 trillion servicing book creates recurring revenue and a major recapture opportunity, while Redfin supplies high-intent buyers and integration savings are arriving ahead of schedule.
The key risk is that rates remain high while integration benefits take longer to reach per-share earnings. The transformation is credible, but the company has not escaped the mortgage cycle. I would build the position gradually rather than make a large bet before earnings.
Action Recap
🏠 Looking to buy? Start a position on pullbacks and leave room to add after the August 6 earnings report.
📈 Already own it? Keep holding while servicing recapture, Redfin lead conversion, and the $400 million synergy plan stay on track.
⚠️ Main risk to respect: Persistently high mortgage rates could overwhelm the benefits of integration and platform growth.
You Read This Far. Here's Where the Real Work Lives.
We run three live portfolios on Autopilot, and everything about them is public: every position, every allocation, every trade, visible the moment it happens.
We keep our own money in each one, because analysis you won't fund yourself is just content.
THE UNBREAKABLE STACK
Our growth book: durable software and cybersecurity names built to compound quietly for years.
THE HORMUZ PREMIUM
Our energy thesis: built for how that sector actually pays, over quarters, not headlines.
THE SQUEEZE
The defensive sleeve: staples and steady compounders, boring on purpose, built for the nights you'd rather sleep than watch futures.
And here's the part that makes it effortless: Autopilot does the trading for you. Connect the brokerage you already use (Robinhood, Schwab, Fidelity, and more) and every move we make gets mirrored in your own account automatically.
Your money never leaves your brokerage. It stays in your account, under your control, and you can override any trade or disconnect anytime. Autopilot even rebalances automatically when allocations drift, and you get a notification every time something happens.
No watching tickers. No timing entries. No fat-finger mistakes at market open. You pick the portfolio, we do the work, your account follows along.
Pick the one that fits your risk level, or run all three:
Live portfolios, real positions, our own capital at stake. Your funds stay in your own brokerage account. Past performance doesn't guarantee future results.
That’s all for today. Thank you for reading. If you have any feedback, please reply to this email.
Best Regards,
— Adam Garcia
Elite Trade Club
Click here to get our daily newsletter straight to your cell for free.
P.S. Just like this newsletter, it's 100% free*, and you can stop at any time by replying STOP.
