LoanDepot (LDI) Surges 26.75% on Citron Valuation, Fed Rate Cut Hopes

LoanDepot Inc. (LDI) surged 26.75% on Wednesday, marking its third consecutive day of gains and a 46.70% rally over three days. The stock reached its highest level since September 2025, with an intraday jump of 30.70% amid renewed investor optimism.

The recent price momentum is largely attributed to a bullish assessment by Citron Research, which highlighted LoanDepot’s undervalued mortgage servicing division. The firm estimated the division’s standalone worth at $5 per share, significantly higher than LDI’s recent trading price. This analysis drew parallels to similar undervaluation calls on mortgage peers, fueling speculation that the market may soon reprice the stock to reflect its broader asset base.

Macroeconomic developments further bolstered sentiment. Weak August jobs data, showing just 22,000 new jobs, intensified expectations for a Federal Reserve rate cut at its September 17 meeting. Lower interest rates are a key tailwind for mortgage lenders, as they stimulate refinancing demand and reduce borrowing costs. LoanDepot’s business model, heavily tied to mortgage origination and servicing volumes, stands to benefit directly from such a policy shift.

Market dynamics were also influenced by a sharp decline in 30-year fixed mortgage rates, which fell 16 basis points to 6.29% in early September. This drop, the largest in over a year, reignited refinancing activity and new loan demand, aligning with LoanDepot’s core operations. The stock’s volatility mirrored sector-wide trends, as peers like Rocket Companies also saw gains, reflecting the interconnected nature of mortgage finance companies.

Technical indicators and short-term trading activity added to the upward pressure. Elevated options trading and positive price trends across multiple timeframes attracted speculative buyers. However, historical patterns suggest caution, as large single-day gains often precede consolidation or pullbacks. Investors are now monitoring key resistance levels and technical signals like the RSI to gauge the sustainability of the rally.

Strategic moves by LoanDepot, including a $150 million financing secured by mortgage servicing rights, provided additional stability amid market volatility. The appointment of Anthony Hsieh as permanent CEO in July also signaled leadership continuity, which analysts view as a stabilizing factor during periods of uncertainty.