According to the lawsuit, defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that:
- Rocket Companies’ 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;
- Rocket Companies 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 Companies’ Partner Network operating segment;
- the adverse trends identified above were accelerating and, as a result, Rocket Companies’ gain on sale margins were on track to plummet at least 140 basis points in the first six months of 2021;
- as a result of the above, the favorable market conditions that had preceded the Class Period and allowed Rocket Companies 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;
- rather than remaining elevated due to surging demand, Rocket Companies’ Company-wide gain-on-sale margins had fallen materially below recent historical averages; and
- 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.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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