Needham reiterates Buy on Roblox stock, maintains $159 price target

Investing.com - Needham has reiterated its Buy rating on Roblox Corp. (NYSE:RBLX) with a price target of $159.00 following the company’s better-than-expected third-quarter earnings results. The target represents significant upside potential from the current price of $113, with analyst targets ranging from $65 to $180.

Despite the positive earnings report, Needham noted that cautious commentary from Roblox regarding its 2026 outlook has limited the impact of positive estimate revisions for the second half of 2025. This caution comes even as the stock has seen a substantial 68.53% price increase over the past six months, though it has recently pulled back 11.52% over the last week.

The research firm models covenant EBITDA for Roblox at just below $1.9 billion in 2026, which it expects to be a key point of debate for investors, balancing the anticipated inflection in bookings during 2025 with limited visibility into precise financials due to Roblox’s user-generated content model.

Needham suggested that while initial 2026 commentary may pressure some high-end estimates, this creates a more favorable risk-reward profile for the stock going forward.

Long term, Needham continues to view Roblox as a significant beneficiary of artificial intelligence, noting that the company should be able to leverage its "significant data advantage" to drive market share gains.

In other recent news, Roblox Corp . reported third-quarter bookings of $1.92 billion, surpassing FactSet consensus estimates of $1.72 billion. The company has projected fourth-quarter bookings to reach $2.03 billion at the mid-point, indicating a 44% year-over-year growth. Goldman Sachs has upgraded Roblox’s stock rating to Buy, highlighting the company’s robust market position and increasing user engagement. Additionally, Raymond James has maintained an Outperform rating on Roblox, noting that the company’s third-quarter results exceeded expectations with significant growth in daily active users and engagement metrics.

Oppenheimer, however, lowered its price target on Roblox to $150, citing margin concerns, while still maintaining an Outperform rating. Jefferies also reduced its price target to $115, expressing caution over the 2026 outlook despite a 70% year-over-year bookings growth. Raymond James reassured investors that Roblox’s 2026 outlook is not as dire as some fears, suggesting that growth might moderate after a strong 2025. The firm also believes that a 20% year-over-year growth could be a conservative estimate for the company’s future performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.