Roblox (NYSE:RBLX) Upgraded to Strong-Buy at Arete Research

Arete Research upgraded shares of Roblox (NYSE:RBLX) from a hold rating to a strong-buy rating in a research note published on Monday,Zacks.com reports.

A number of other analysts have also recently issued reports on RBLX. Cantor Fitzgerald initiated coverage on Roblox in a report on Monday. They set an “overweight” rating on the stock. Oppenheimer assumed coverage on Roblox in a report on Friday, May 1st. They set an “outperform” rating for the company. Canaccord Genuity Group decreased their price target on Roblox from $140.00 to $80.00 and set a “buy” rating on the stock in a research report on Friday, May 1st. Bank of America downgraded shares of Roblox from a “buy” rating to a “neutral” rating and set a $48.00 price target on the stock. in a report on Friday, May 1st. Finally, Deutsche Bank Aktiengesellschaft assumed coverage on shares of Roblox in a research report on Monday. They issued a “buy” rating for the company. Two investment analysts have rated the stock with a Strong Buy rating, fifteen have issued a Buy rating, eleven have issued a Hold rating and two have given a Sell rating to the stock. Based on data from MarketBeat.com, Roblox presently has an average rating of “Moderate Buy” and a consensus target price of $86.30.

Roblox Trading Up 14.3%

Shares of RBLX stock opened at $54.37 on Monday. The stock has a market capitalization of $36.51 billion, a price-to-earnings ratio of -34.41 and a beta of 1.44. The company’s fifty day simple moving average is $48.06 and its two-hundred day simple moving average is $61.84. Roblox has a 1 year low of $40.15 and a 1 year high of $150.59. The company has a debt-to-equity ratio of 2.45, a current ratio of 0.89 and a quick ratio of 0.89.

Roblox (NYSE:RBLX) last posted its quarterly earnings results on Thursday, April 30th. The company reported ($0.35) EPS for the quarter, topping analysts’ consensus estimates of ($0.41) by $0.06. The firm had revenue of $1.44 billion during the quarter, compared to analyst estimates of $1.74 billion. Roblox had a negative return on equity of 277.69% and a negative net margin of 20.69%.The business’s revenue for the quarter was up 43.4% on a year-over-year basis. During the same period last year, the company earned ($0.32) earnings per share. As a group, analysts anticipate that Roblox will post -1.4 earnings per share for the current year.

Roblox declared that its board has approved a stock buyback program on Tuesday, May 19th that allows the company to buyback $3.00 billion in shares. This buyback authorization allows the company to purchase up to 9.5% of its stock through open market purchases. Stock buyback programs are typically an indication that the company’s leadership believes its shares are undervalued.

Insiders Place Their Bets

In other news, CFO Naveen K. Chopra sold 16,863 shares of the business’s stock in a transaction dated Wednesday, May 20th. The stock was sold at an average price of $45.28, for a total transaction of $763,556.64. Following the completion of the transaction, the chief financial officer owned 380,758 shares of the company’s stock, valued at approximately $17,240,722.24. The trade was a 4.24% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Mark Reinstra sold 18,653 shares of the business’s stock in a transaction dated Monday, April 13th. The stock was sold at an average price of $57.94, for a total value of $1,080,754.82. Following the transaction, the insider directly owned 455,473 shares of the company’s stock, valued at $26,390,105.62. The trade was a 3.93% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders sold 189,449 shares of company stock worth $9,179,410. 10.05% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Roblox

Several hedge funds have recently bought and sold shares of RBLX. Reyes Financial Architecture Inc. increased its holdings in shares of Roblox by 164.4% in the 4th quarter. Reyes Financial Architecture Inc. now owns 312 shares of the company’s stock worth $25,000 after buying an additional 194 shares during the last quarter. Hanson & Doremus Investment Management bought a new stake in shares of Roblox during the 1st quarter worth $25,000. Fideuram Asset Management Ireland dac bought a new stake in shares of Roblox during the 4th quarter worth $27,000. Basecamp Wealth Advisors LLC grew its position in Roblox by 98.8% in the first quarter. Basecamp Wealth Advisors LLC now owns 507 shares of the company’s stock worth $29,000 after acquiring an additional 252 shares in the last quarter. Finally, GW&K Investment Management LLC grew its position in Roblox by 76.3% in the fourth quarter. GW&K Investment Management LLC now owns 372 shares of the company’s stock worth $30,000 after acquiring an additional 161 shares in the last quarter. 94.46% of the stock is currently owned by institutional investors.

Key Roblox News

Here are the key news stories impacting Roblox this week:

• Positive Sentiment: Roblox is seeing unusually heavy call option activity, suggesting some traders are betting on further upside in the stock. Roblox shows huge, unusual call option activity – is RBLX stock too cheap?
• Positive Sentiment: Market commentary is highlighting a possible valuation opportunity in Roblox after the recent selloff, which may be helping attract bargain hunters. Roblox stock is surging Monday: What’s driving the action?
• Neutral Sentiment: Several law firms are reminding investors of the August 7 deadline to seek lead-plaintiff status in the securities class action, keeping legal scrutiny around Roblox in the spotlight. ROSEN, HIGHLY REGARDED INVESTOR COUNSEL, Encourages Roblox Corporation Investors to Secure Counsel Before Important Deadline in Securities Class Action – RBLX
• Neutral Sentiment: The class-action filings center on Roblox’s April quarter update, where the company reported a sharp sequential decline in daily active users after its age-verification rollout, adding uncertainty around user growth. Roblox Corporation (RBLX) Faces Securities Class Action Amid Surprise Age Verification Impact, $6.7 Billion Market Cap Wiped Out – HBBS
• Negative Sentiment: Multiple firms say a securities fraud class action has already been filed against Roblox and its officers, a legal overhang that could pressure sentiment. RBLX Investors Have Opportunity to Lead Roblox Corporation Securities Fraud Lawsuit

Roblox Company Profile

Roblox Corporation operates Roblox, a user-generated online platform that enables people to create, share and monetize immersive 3D experiences and games. The core offering centers on Roblox Studio, a development environment that allows independent creators and studios to design interactive worlds using the company’s building tools and scripting language. Content on the platform spans games, virtual hangouts, branded experiences and live events, all delivered through a persistent social environment.

Roblox’s business model is built around its virtual economy and creator ecosystem.