Rocket Companies Inc (RKT  ) is trading lower Wednesday morning as investors reacted to Zillow Group Inc's (Z  ) (ZG  ) quarterly update, which pushed Zillow shares down despite revenue growth. Here's what investors need to know.

Zillow's Mixed Report Weighs On Housing Sentiment

Zillow reported fourth-quarter revenue of $654 million, ahead of Wall Street expectations, while adjusted earnings per share of 39 cents missed the 40-cent consensus estimate.

The company's revenue grew 18% year-over-year and first-quarter sales guidance of $700 to $710 million topped estimates, yet the stock fell about 19% Wednesday after the release.

Why Rocket Companies Is Moving In Sympathy

Traders often treat Zillow as a barometer of United States housing activity, so a negative reaction to its results can spill over to other housing-sensitive names such as Rocket Companies.

For Rocket, softer sentiment around listings, buyer traffic and real-estate advertising can translate into worries about mortgage origination volumes, refinance demand and gain-on-sale margins. Rocket is one of the largest U.S. mortgage originators.

As investors reassess growth expectations for housing, mortgage-exposed stocks like RKT can face short-term selling pressure simply because they share the same macro drivers: home prices, transaction volumes and interest-rate trends.

RKT's Business Model

Rocket Companies is a financial services company that was originally founded as Rock Financial in 1985 and is currently based in Detroit. Rocket Companies offers a wide array of services and products but is best known for its Rocket Mortgage business.

The company's mortgage lending operations are split between its direct-to-consumer lending, which sees borrowers accessing the company's lending arm directly through either its mobile app or website, and its partner network where mortgage brokers and other firms use Rocket's origination process to offer loans to their customers.

Rocket Earnings Update Set February 26

Rocket Companies is slated to provide its next financial update on Feb. 26.

  • EPS Estimate: 8 cents (Up from 4 cents YoY)
  • Revenue Estimate: $2.28 billion (Up from $1.19 billion YoY)
  • Valuation: P/E of 289.3x (Indicates premium valuation)
Analyst Consensus & Recent Actions: The stock carries a Hold Rating with an average price target of $19.47. Recent analyst moves include:

  • JP Morgan: Neutral (Target $24.00) (Jan. 12)
  • Barclays: Equal-Weight (Raises Target to $22.00) (Jan. 6)
  • Jefferies: Initiated with Buy (Target $25.00) (Dec. 19, 2025)
Valuation Insight: While the stock trades at a premium P/E multiple, the consensus and rising estimates suggest analysts view the growth prospects as justification for the 4% upside to analyst targets.

Benzinga Edge Rankings

Below is the Benzinga Edge scorecard for Rocket Companies, highlighting its strengths and weaknesses compared to the broader market:

  • Quality: 3.25 - The stock shows a moderate quality ranking, indicating some stability.
  • Momentum: 84.27 - The stock is outperforming the broader market.
The Verdict: Rocket Companies' Benzinga Edge signal reveals a classic 'High-Flyer' setup. While the Momentum (84.27) confirms the strong trend, the low Quality (3.25) score warns that the stock may face challenges ahead-investors should remain cautious.

RKT Shares Slide Wednesday

RKT Price Action: Rocket Companies shares were down 7.23% at $18.79 at the time of publication on Wednesday, according to Benzinga Pro data.