Robbins Geller Rudman & Dowd LLP Files Class Action Suit Against Rocket Companies, Inc. and Announces Opportunity for Investors With Substantial Losses to Lead Case

San Diego, Calif .– (Newsfile Corp. – July 1, 2021) – Robbins Geller Rudman & Dowd LLP announced today that it has filed a class action lawsuit to seek buyers of Class A common stock of Rocket Companies, Inc. (NYSE: RKT ) to represent during the period between February 25, 2021 and May 5, 2021, both dates inclusive (the “Class Period”). The Rocket Companies class action lawsuit, filed in the Eastern District of Michigan, is entitled Qaiyum v Rocket Companies, Inc., No. 21-cv-11528. The Rocket Companies class action lawsuit accuses Rocket Companies and some of its executives of violating the Securities Exchange Act of 1934.

If you have suffered significant losses and would like to serve as the lead plaintiff in the Rocket Companies class action or if you have any questions about your rights in relation to the Rocket Companies class action, please visit our website by clicking here or contact Brian Cochran of Robbins Geller at 800 / 449-4900 or 619 / 231-1058 or by email to [email protected] You can view a copy of the submitted complaint at https://www.rgrdlaw.com/cases-rocket-companies-inc-class-action-lawsuit.html.

CASE ALLEGATIONS: The Rocket Companies class action alleges that during the class action period, defendants made false and misleading statements and failed to disclose that: (i) Rocket Companies’ profit margins have declined more than they have been in two years Competition among mortgage lenders, an unfavorable shift towards the Partner Network operating segment with lower margins, and a narrowing of the price spread between the primary and secondary mortgage markets; (ii) Rocket Companies was embroiled in a price war and battle for market share with its major competitors in the wholesale market, which further depressed margins in Rocket Companies’ Partner Network operating segment; (iii) the adverse trends identified above accelerated and, as a result, Rocket Companies’ profit margins were on track to plummet by at least 140 basis points in the first six months of 2021; (iv) As a result, the favorable market conditions that preceded the class action period and allowed Rocket Companies to achieve historically high profit margins had disappeared as Rocket Companies profit margins had returned to levels not seen since Q1 2019 ; (v) Rocket Companies’ corporate-wide profit margins, rather than remaining elevated due to increased demand, had fallen significantly below pre-pandemic average; and (vi) as a result, Defendants’ positive statements about the business and prospects of Rocket Companies were materially misleading and / or unfounded.

The story goes on

On May 5, 2021, Rocket Companies announced that the company was well on the way to achieving loan volume in the second quarter of 2021 in a range of just $ 82.5 billion to $ 87.5 billion and a sales margin in A range of just 2.65% to 2.95% in the middle, that sales margin estimate was down 239 basis points year-over-year and down 94 basis points sequentially, the Rocket Companies’s lowest quarterly sales margin profit in two Years represents. The staggering slump in Rocket Companies’ profit margin reflected the fact that the supposedly favorable market conditions Rocket Companies experienced during the class action period had actually reversed. During a conference call to explain the results, Defendant Julie R. Booth, chief financial officer and treasurer of Rocket Companies, revealed that the sharp decline in quarterly earnings on sales margin was caused by three factors: (i) pressure on loan prices; (ii) a shift in the product mix to the lower margin Rocket Companies’ partner network segment; and (iii) a compression of the price spreads between the primary and secondary mortgage markets. Defendant Booth also admitted that some of these trends began “at the end of the first quarter”. On the news, Rocket Companies’ Class A common stock fell nearly 17% to close at $ 19.01 per share. As the market continued to digest the news over the days that followed, the price of Rocket Companies Class A common stock continued to decline, falling to a low of just $ 16.48 per share by May 11, 2021.

LEAD ACTION: The Private Securities Litigation Reform Act of 1995 allows any investor who has purchased Rocket Companies common stock during the class action period to seek appointment as the lead plaintiff in the Rocket Companies class action. A lead plaintiff is usually the applicant with the greatest financial interest in the legal protection sought by the alleged class, which is also typical and appropriate for the alleged class. One lead plaintiff is acting on behalf of all of the other class plaintiffs in directing the Rocket Companies class action. The lead plaintiff can choose a law firm of their choice to bring the Rocket Companies class action lawsuit. An investor’s ability to participate in a possible future recovery of the Rocket Companies class action lawsuit does not depend on being the lead plaintiff. If you want to appear as the lead plaintiff in Rocket Companies’ class action lawsuit, you must postpone the court no later than August 30, 2021.

The plaintiff is represented by Robbins Geller, who has extensive experience in prosecuting investor class actions, including lawsuits related to financial fraud.

ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 attorneys in 9 offices across the country, Robbins Geller Rudman & Dowd LLP is the largest US law firm serving investors in securities class actions. Robbins Geller’s attorneys have secured many of the largest shareholder recoveries in history, including the largest class action lawsuit of all time – $ 7.2 billion – in In re Enron Corp. Sec. Lit. The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for getting $ 1.6 billion back for investors last year, more than double the amount paid by any other securities plaintiff firm was drafted. More information is available at http://www.rgrdlaw.com.

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Contact:

Robbins Geller Rudman & Dowd LLP
655 W. Broadway, San Diego, CA 92101 619-231-1058
Brian E. Cochran, 800-449-4900
[email protected]
https://www.linkedin.com/company/rgrdlaw
https://twitter.com/rgrdlaw
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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/89250

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