Just yesterday, Rocket Companies stock was at $18.08. However, it is declining today amid some negative news: it is currently at $17.46, resulting in a 3.4% loss. The loss can be even more. The Gross Law Firm notifies investors that a class action has commenced in the United States District Court for the Eastern District of Michigan on behalf of shareholders of Rocket Companies, who purchased shares between February 25, 2021, and May 5, 2021.
The filed complaint alleges that defendants made materially false and/or misleading statements and/or failed to disclose that: (a) Rocket’s gain on sale margins were contracting at the highest rate in two years as a result of increased competition among mortgage lenders, an unfavorable shift toward the lower margin Partner Network operating segment and compression in the price spread between the primary and secondary mortgage markets; (b) Rocket was engaged in a price war and battle for market share with its primary competitors in the wholesale market, which was further compressing margins in Rocket’s Partner Network operating segment.
(c) The adverse trends identified above were accelerating and, as a result, Rocket’s gain on sale margins was on track to plummet at least 140 basis points in the first six months of 2021; (d) as a result of the above, the favorable market conditions that had preceded the Class Period and allowed Rocket to achieve historically high gain on sale margins had vanished as the Company’s gain on sale margins had returned to levels not seen since the first quarter of 2019.
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