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Back of Napkin

Rocket Companies, Inc. RKT

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Rocket now services $2.02 trillion of mortgages, up from $609 billion a year ago, after buying the country's largest servicer in an all-stock deal.

The margin on the loans it actually makes fell from 2.80% to 2.48% over the same period.

RKT · price with moving averages

Daily · 6MWeekly · 3Y
$6$11$15$20$25 Sep '23Apr '24Nov '24Jun '25Jan '26Aug '26 BID
EMAs82140

Source: market data.

The business

Rocket originates mortgages, mostly online and direct to the borrower, and then services them, meaning it collects the monthly payment and handles the escrow for a fee. It also owns Redfin, the property brokerage, bought last July.

The two halves work against each other on purpose. When rates fall, people refinance and origination booms while the servicing book runs off. When rates rise, origination collapses and the servicing rights become more valuable because nobody refinances away. Owning both is supposed to smooth the cycle.

Inside the complete Back of Napkin

  1. 01The business
  2. 02The numbers
  3. 03Management
  4. 04How it fails or surprises you
  5. 05The shape of the payoff
  6. 06Closing thoughts
  7. 07Methodology

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