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Summary
- Stocks of Rocket Companies (NYSE:RKT, RKT:US) soared by 71 per cent to close at a new high of US$ 41.6.
- The massive spike came after day traders of Reddit thread WallStreetBets took the heavily shorted stock under its wing recently.
- The stock also recorded a fresh 52-week high of US$ 43 and a total trading volume of nearly 377 million during the intraday session on Tuesday.
Tuesday, March 2, saw stocks of financial services provider Rocket Companies (NYSE:RKT, RKT:US) soar by 71 per cent to close at a new high of US$ 41.6. The massive spike came after the now-famous day traders of Reddit thread WallStreetBets took the heavily shorted stocks of Rocket Companies under its wing recently.
The stock also recorded a fresh 52-week high of US$ 43 and a total trading volume of nearly 377 million during the intraday session on Tuesday.
Rocket Stocks Rise on Tuesday
Reddit-based retail investors made their mark on the stock market biosphere in January after the group collectively took on short sellers to boost the prices of shorted stocks. What started as a chatroom war quickly snowballed into a media attention-grabbing feud as meme stocks GameStop, AMC Entertainment, etc started going through the roof. After making headlines for a while, the Reddit-fueled rally died down around the first week of February, only to gain momentum again during the end of the month.
Rocket Companies made it to the Reddit rally after a major portion of its freely traded shares was reportedly sold short recently. The retail traders of WallStreetBets appear to have taken a note of this and begun discussing the stock heavily, which quickly started steering Rocket scrips in the other direction.
©Kalkine Group 2021
With nine million-plus members, the Reddit-based commune has shown to have a substantial impact on a stock’s movement for a period of time. Its darling GameStop stock, for example, went from being priced at US$ 18.84 on January 1, 2021, to hit an all-time closing price high of US$ 347.51 by near the end of the month (January 28).
Rocket stock seems to be one of their recent most targets, as its bullish mentions on the Reddit thread and other social media platforms this week was followed by a rapid rise in its price and trading volume. Tuesday’s surge helped pull Rocket’s year-to-date growth to nearly 97 per cent.
Rocket’s Latest Financials
Unlike a few stocks promoted by the day traders previously, Rocket Companies’ latest financial results reflect a notable revenue and income rise.
The Detroit-based mortgage provider posted a 144 per cent year-over-year (YoY) rise in its revenue of US$ 4,699 million and a 277 per cent YoY increase in its net income of US$ 2,841 million for the fourth quarter ending 31 December 2020.
On an annual level, Rocket secured a revenue growth of 208 per cent YoY and a net income growth of 948 per cent YoY for the fiscal year of 2020.
