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On Monday, Citi analysts adjusted the financial outlook for Roblox Corp . (NYSE:RBLX), revising the price target downward to $78 from the previous $82, while sustaining a Buy rating on the company’s shares. The modification follows the review of Roblox’s fourth-quarter 2024 performance and an updated forecast. According to InvestingPro data, Roblox has demonstrated strong market performance with a 50.77% return over the past year, trading at $61.46 with a market capitalization of $41 billion.
Roblox’s fourth-quarter results showcased net bookings that aligned with the consensus estimates and an adjusted EBITDA that exceeded Wall Street’s expectations. However, the company’s daily active users (DAUs) did not meet the consensus projections. Additionally, the 2025 bookings guidance provided by Roblox was slightly below the expectations set by analysts. InvestingPro analysis reveals impressive revenue growth of 28.68% in the last twelve months, though the company remains unprofitable with negative earnings per share of $1.44.
The new price target of $78 is based on approximately 35 times Citi’s 2026 free cash flow per share estimate for Roblox. Despite the reduction in the price target, Citi continues to support the stock with a Buy rating, indicating a positive outlook on the company’s future financial performance. Based on InvestingPro’s Fair Value analysis, the stock appears fairly valued, with analyst targets ranging from $30 to $83. Subscribers can access 10 additional ProTips and comprehensive financial analysis in the Pro Research Report.
The adjustment in Roblox’s price target reflects Citi’s analysis of both the recent quarter’s achievements and the projections for the coming year. The company’s ability to surpass adjusted EBITDA estimates while falling short on DAUs and forward bookings guidance has led to a nuanced view of its near-term financial trajectory.
Investors and stakeholders in Roblox Corp. will be monitoring the company’s progress as it navigates the expectations set forth by both the company’s guidance and analyst projections. The maintained Buy rating suggests that, despite the slight downturn in the price target, Citi sees potential for Roblox’s growth and profitability in the longer term.
In other recent news, Roblox Corp. is under investigation by the U.S. Securities and Exchange Commission (SEC), as confirmed by Bloomberg. The exact subject of the investigation has not been disclosed, and both Roblox and the SEC have refrained from commenting further on the matter. Meanwhile, Roblox’s recent financial performance has prompted several analysts to adjust their outlooks. Benchmark analysts raised their price target for the company to $71, citing strong growth in bookings and an expanded Adjusted EBITDA margin. Needham analysts also increased their price target to $72, maintaining a Buy rating despite noting a slowdown in bookings growth. Oppenheimer maintained a Perform rating following Roblox’s robust fourth-quarter results, which included a significant increase in daily active users and bookings. Lastly, Goldman Sachs lifted its price target to $63, maintaining a Neutral rating while acknowledging Roblox’s solid monetization and engagement trends. These developments reflect a mix of optimism and caution among analysts regarding Roblox’s future performance.
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