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Investing.com - Canaccord Genuity raised its price target on Roblox Corp . (NYSE:RBLX) to $160.00 from $125.00 on Thursday, while maintaining a Buy rating following the company’s strong second-quarter results. The stock, currently trading at $137.20, has delivered impressive returns of over 200% in the past year, according to InvestingPro data.
The gaming platform reported quarterly performance that exceeded market expectations across daily active users, bookings, and profitability metrics. With revenue growing at 30.24% year-over-year and a market capitalization of $93 billion, Roblox continues to expand its market presence. Canaccord noted that AI-powered improvements to search and discovery features are driving stronger engagement across a broader range of experiences on the platform.
The firm highlighted that viral hits are creating a positive "halo effect" for the entire platform, with 75% of "Grow a Garden" users engaging with at least one other experience on the same day they played. Infrastructure investments to support activity spikes and enhancements to Roblox’s virtual economy are also contributing to increased monetization.
Roblox provided what Canaccord described as "very strong" guidance for the third quarter and raised its full-year 2025 outlook. Management indicated that while growth momentum continued into July, they took a conservative approach to second-half forecasts as the company faces challenging comparisons from viral hits in the third quarter of 2024.
The research firm acknowledged that Roblox shares "are certainly not cheap" but justified the premium valuation based on the company’s "rare combination of bookings growth and margin expansion," with potential additional upside from advertising and commerce initiatives. InvestingPro analysis indicates the stock is trading above its Fair Value, with technical indicators suggesting overbought conditions. Discover more insights and 12 additional ProTips for Roblox in the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Roblox Corp reported impressive financial results for the second quarter of 2025. The company exceeded revenue expectations by posting $1.1 billion, although the forecast had been set at $1.26 billion. Despite a larger-than-anticipated loss per share of $0.41, the company’s performance highlighted strong user engagement and bookings growth. This growth was further emphasized by a notable 51% increase in year-over-year bookings, surpassing even the most optimistic forecasts. In response to these developments, BofA Securities raised its price target for Roblox to $159 from $133, maintaining a Buy rating on the stock. The firm pointed to the significant bookings growth as a key factor in their decision. These recent developments underscore the market’s confidence in Roblox’s growth potential.
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