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Rocket Companies CEO Downplays Rising Interest Rates

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Chris Katje
·2 min read
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Rocket Companies (NYSE: RKT) has been one of the most talked-about stocks in March and CEO Jay Farner appeared Thursday morning on Fox Business Network's "Varney & Co."

What Happened: Farner discussed his thoughts on the 2020 performance of Rocket Companies, the parent company of Rocket Mortgage and Quicken Loans.

Farner said the company's 2020 performance was great and he's excited about the future of the business highlighting the Rocket Homes real estate platform.

Interest rates have been a hot topic for investors and there's a lot of focus on which companies could win or lose if interest rates go up. Farner said interest rates going up are good for Rocket Companies.

"And when they go down, we've got 95% retention rates for our services," Farner said.

Related Link: Detroit's Mortgage Giants Rocket Higher Amid Latest Wallstreetbets Sparked Short Squeeze

Why It’s Important: Rocket Companies recently reported fourth-quarter adjusted revenue growth of 162% year-over-year to $4.8 billion. Full fiscal 2020 revenue was $16.9 billion. The company also saw record closed loan origination volume of $107.2 billion in the fourth quarter.

Rocket Companies announced a partnership with Morgan Stanley (NYSE: MS) to originate and service conforming mortgages for Morgan Stanley and E*Trade clients.

The company is expanding its service offerings and continues to be viewed as both a mortgage company and a technology stock.

Farner's comments on interest rates being positive for the company whether they go up or down could help ease investor concerns for short-term pain for mortgage companies. There's concern that higher interest rates could lower the demand for mortgage applications.

RKT Price Action: Shares of Rocket Companies are up 2.7% to $26.65 at publication time. The stock has traded between $17.78 and $43 since going public in August 2020.

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