Wells Fargo cuts Rocket Cos stock price target on mortgage outlook

Wells Fargo has reduced its price target for Rocket Cos Inc. (NYSE: RKT) from $15.00 to $13.00, while keeping an Equal Weight rating. The stock is currently trading at $11.68, near its 52-week low of $11.25, with a 40% year-to-date decline. The firm lowered its revenue forecast for Q3 2026, projecting $2.59 billion instead of $2.63 billion, placing it below consensus and the company's guidance range.

This adjustment stems from a smaller mortgage market, lower gain-on-sale revenue, and slower mortgage servicing rights amortization. The company's 2026 and 2027 EPS estimates were also cut by 1 and 15 cents to $0.61 and $0.80, respectively, falling short of the consensus estimates of $0.85. Despite the challenging outlook, the stock appears overvalued, trading at a high P/E ratio of 66.37.

Wells Fargo anticipates Rocket’s fourth-quarter revenue to fall below analyst expectations due to mortgage market conditions. Rocket Companies reported its Q2 2026 earnings, missing analysts' expectations with adjusted diluted earnings of $0.16 per share on $2.76 billion revenue. However, the company highlighted its profitability and market share gains.

StoneX maintained a Buy rating with a $19.00 price target, citing Rocket's market share improvements. Investors are wary of the modest miss and cautious third-quarter outlook.