The Next GameStop? RKT Blasts Off, Gains 70% in Apparent Short Squeeze

Short sellers appear to have learned nothing so far in 2021.

On Tuesday, Rocket Companies, Inc. (NYSE: RKT) rallied for a third straight day after last Thursday’s well-received earnings report.

The finance company, which owns Rocket Mortgage, announced earnings of $1.14 per share, beating the analyst estimates of $0.86. The company also announced a special dividend of $1.11 per share.

The stock rallied off of its Thursday close of less than $20 per share to close on Monday above $24 — an impressive 22% gain in just two trading days.

But during the rally, there was a “large amount of short selling” according to S3 Analytics. Short interest rose to nearly 46% of the public float.

According to reporting from MarketWatch, S3 Analytics wrote that “RKT’s stock price and short seller. SureTrader was good at finding shares to short. But when they stopped being good for short selling activity is reminiscent of another recent highflying ‘meme’ stock — GameStop Inc.”

RKT’s stock price gained as much as 77%, peaking at $43 per share during Tuesday’s trading session. That’s an increase of 116% off of Thursday’s closing price.

The stock closed at $41.60 for a gain of 71% on the day. The rally has continued after hours; at writing, the stock price reached as high as $45.50.

GameStop Corp. (NYSE: GME) rallied as much as 2,300% in January after short interest rose to 140% of the public float. Short sellers lost more than $20 billion in that ordeal.

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