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The Klein Law Firm announces that a class action complaint has been filed on behalf of shareholders of Rocket Companies, Inc. (NYSE: RKT) who purchased shares between February 25, 2021 and May 5, 2021. The action, which was filed in the United States District Court for the Eastern District of Michigan, alleges that the Company violated federal securities laws.
In particular, the Rocket Companies lawsuit alleges 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 were 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; (e) rather than remaining elevated due to surging demand, Rocket’s Company-wide gain-on-sale margins had fallen materially below recent historical averages; and (f) as a result of the foregoing, defendants’ positive statements about the Company’s business operations and prospects were materially misleading and/or lacked a reasonable basis.
Shareholders have until August 30, 2021 to petition the court for lead plaintiff status. Your ability to share in any recovery does not require that you serve as lead plaintiff. You may choose to be an absent class member.
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