Rocket Cos. (RKT) - Get Report, the parent of Quicken Loans and Rocket Mortgage, on Tuesday was climbing at warp speed, boosted by falling interest rates, a strong earnings report and a possible lift from retail investors.
Shares of the Detroit online mortgage provider at last check were 41% higher at $34.11.
Falling interest rates have been a factor. Rocket stock was one of the most active stocks in the options market on Monday, according to Investors Business Daily, with total volume of more than 365,000 contracts.
The stock could also be a Reddit target for its high short interest. The company has large short bets placed against it by hedge funds, CNBC reported, and it appears to have garnered some bullish interest from day traders on Reddit’s WallStreetBets.
"I have been a huge fan of [CEO] Jay Farner and [Chairman] Dan Gilbert," TheStreet.com founder Jim Cramer said on CNBC, "and frankly don’t understand why the stock did not react to what was a very good quarter where they basically laid out a story that just said, ‘We can show how when rates go up, it has not hurt our business. When rates go down, it’s not hurt our business.’”
Earlier this year, videogame retailer GameStop (GME) - Get Report and a handful of other companies were at the center of a Reddit-fueled buying frenzy, driven by an army of retail investors active on WallStreetBets.
Several posters were discussing Rocket Cos. on Tuesday.
"I took a nap during lunch and my RKT calls and shares are up another 200% what the f--- did you guys do?" one poster wrote.
"Who told me I'm not buying a Lambo today?!" another declared. "Rocket to the f---g moon!"
On Friday, Rocket Cos. reported fourth-quarter earnings and revenue that exceeded Wall Street estimates. Rocket completed a year of record mortgage volume and said it would pay a special dividend of $1.11 a share.
Rocket Cos. reported earnings of $1.09 a share, exceeding the analyst consensus estimate of 87 cents a share. Revenue of $4.78 billion also topped forecasts.