* Note: Prices are in Million (M) USD.
Description:
Rocket Companies, Inc. is engaged in the technology-driven real estate, mortgage and e-commerce businesses in the United States and Canada. The company is headquartered in Detroit, Michigan.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $1,273 M
Debt : $4,763 M
EBITDA : $769 M
Net Debt (Debt - Cash): $3,490 M
Since EBITDA cannot cover net debt within 3 years, Avoid This Stock.
This criteria used industry in which company operates:
Sector: Financial Services
Industry: Savings Institutions
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 31.81
Since Forward PE Ratio is between 25 - 35, 1 point assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Average Free Cash Flow: $997 M
Average Revenue: $6,693 M
Revenue Converted To Free Cash FLow(%): 15%
Since Free Cash Flow (FCF) to Revenue percentage is less than 15, 1 point assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $5,401 M
Revenue 4 Years Ago (2020-12-31): $15,896 M
Last 5 Years Average Revenue Growth: -13%
Since Revenue Growth is between 0 - 5, 1 point assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $141 M
Share Count 5 Years Ago (2020-12-31): $1,744 M
Company is buying back its own shares, 3 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $0.81
Trailing 12-Month Earnings Per Share (EPS): $0.23
Average Earnings Per Share (EPS): $0.52
Dividend Per Share (DPS): $0
Payout Ratio: 0%
Dividend Yield: 0%
Since Dividend Per Share is less than or equal to 0, 0 point assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Average ROE: 21%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $17
52-Week Low: $10
Threshold Price (15% Above 52-Week Low): $11
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $26,451 M
Since Market Cap is between 10B - 100B, 2 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 3% exposure of Total Portfolio.
Value-Trade has assigned 16 points to above Rocket Companies Inc (RKT) stock.
Last 4 Years Avg PE (Limited to last 4 years of EPS data) 10, Fair Value PE 12 and Industry Based PE is 12. Based on these three values average assigned is 11.33.
Value-Trades has assined P/E value 11.33. Since an average (Current Year EPS + Next Year EPS) earning per share is $0.52.
The fair value of Rocket Companies Inc (RKT) stock should be (11.33 x $0.52) = $5.89
