Are the Rocket Companies (RKT) currently a high value stock?


TZacks Rank’s proven system focuses on profit estimates and revising estimates to find winning stocks. Still, we know our readers all have their own perspectives, so we always look at the latest trends in value, growth, and momentum to find solid choices.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use proven metrics and fundamental analysis to find companies they believe are undervalued at their current stock price level.

In addition to the Zacks Rankings, investors looking for stocks with specific characteristics can use our Style Scores system. Of course, value investors will be more interested in the “Value” category of the system. Stocks with “A” ratings for value and high Zacks ranks are some of the most profitable stocks available at any given time.

One stock to watch is Rocket Companies (RKT). RKT currently sports a Zacks # 2 (buy) rating, as well as an A rating for value.

Investors should also recognize that RKT has a P / N ratio of 3.64. P / B is a method of comparing the market value of a stock to its book value, which is defined as total assets minus total liabilities. This stock’s P / B looks strong compared to its sector’s average P / B of 10.61. Over the past 52 weeks, RKT’s P / B has reached 10.47 and as low as 3.64, with a median of 5.09.

Value investors also frequently use the P / S ratio. This measurement is obtained by dividing the price of a stock by the turnover of the company. Some people prefer this measure because sales are more difficult to manipulate on an income statement. This means that it could be a truer performance indicator. RKT has a P / S ratio of 1.81. This compares to its industry’s average P / S of 3.64.

Finally, investors should note that RKT has a P / CF ratio of 64.84. This figure highlights a company’s operating cash flow and can be used to find undervalued companies given their impressive cash flow prospects. RKT’s P / CF compares to its industry average P / CF of 101.13. Over the past 52 weeks, RKT’s P / CF has reached 303.82 and as low as 5.12, with a median of 74.99.

These are just a few of the key metrics included in Rocket Companies’ strong Value rating, but they help show that the stock is likely undervalued right now. Considering the strength of its earnings outlook, RKT looks like an impressive value stock for now.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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