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Investing.com - MoffettNathanson upgraded Roblox Corp. (NYSE:RBLX) from Sell to Neutral on Thursday, citing explosive growth in user metrics driven by viral experiences on the platform. The upgrade comes as Roblox shares have surged over 200% in the past year, with a particularly strong 120% gain in the last six months, according to InvestingPro data.
The research firm noted that while it still struggles to make sense of Roblox’s valuation, the company’s significant improvement in user engagement metrics warranted the rating change. With a market capitalization of $87.3 billion and revenue growth of 27% year-over-year, the company trades at premium multiples despite not being profitable.
MoffettNathanson highlighted several viral experiences that have fueled Roblox’s recent growth, including "Grow a Garden," which gained popularity in spring, and "Steal a Brainrot," which the firm described as "the new engagement king."
Another recent launch, "99 Nights in the Forest," is routinely attracting 10-15 million concurrent users during peak Saturday timeslots, according to the research note.
The upgrade comes as Roblox continues to demonstrate its ability to generate viral content experiences that drive user engagement across its gaming platform.
In other recent news, Roblox Corporation has been the focus of several analyst updates and ratings. Moody’s Ratings revised its outlook on Roblox to positive from stable, affirming its Ba1 corporate family rating. This reflects the company’s improving credit profile and expectations for continued strong operating performance over the next 12 to 18 months. Meanwhile, BMO Capital raised its price target for Roblox to $160 from $150, maintaining an Outperform rating, citing strong engagement metrics as a key factor. Piper Sandler also increased its price target to $180, highlighting Roblox’s success in promoting viral content, such as the hit "Steal a Brainrot." In contrast, TD Cowen maintained a Sell rating with a $77 price target, acknowledging that its current estimates might be too conservative given the strong engagement data. Oppenheimer reiterated an Outperform rating with a $158 price target, following changes announced by Epic Games to Fortnite’s in-game economy. These developments indicate varied perspectives among analysts regarding Roblox’s future potential and current performance.
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