Roblox (NYSE:RBLX) Rating Lowered to Sell at Wall Street Zen

Key Points

• Wall Street Zen downgraded Roblox to Sell from Hold. Across analysts, the consensus remains Hold, with an average price target of $53.04.
• Roblox reported quarterly EPS of -$0.32, beating the -$0.43 estimate, but revenue of $1.57 billion fell short of the $1.63 billion consensus. Revenue rose 15.6% year over year.
• Shares opened at $49.93, within a 52-week range of $33.88 to $103.78.

Roblox (NYSE:RBLX - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a note issued to investors on Saturday, Wall Street Zen reports.

A number of other research analysts have also recently commented on the stock. BTIG Research upped their price target on shares of Roblox from $41.00 to $42.00 and gave the stock a "sell" rating in a report on Wednesday, October 28th. TD Cowen reduced their price target on shares of Roblox from $49.00 to $40.00 and set a "hold" rating on the stock in a research note on Friday, July 31st. Needham & Company LLC reiterated a "buy" rating and set a $55.00 price objective on shares of Roblox in a report on Friday, October 30th. The Goldman Sachs Group reissued a "buy" rating and issued a $55.00 price objective on shares of Roblox in a research report on Friday, October 30th. Finally, Jefferies Financial Group lowered their price objective on shares of Roblox from $38.00 to $35.00 and set an "underperform" rating for the company in a research report on Tuesday, November 3rd. Two research analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating, thirteen have issued a Hold rating and five have given a Sell rating to the company. According to MarketBeat.com, the company currently has a consensus rating of "Hold" and an average price target of $53.04.

Roblox Price Performance

RBLX opened at $49.93 on Friday. The business has a fifty day moving average of $48.27 and a 200 day moving average of $51.20. Roblox has a 52-week low of $33.88 and a 52-week high of $103.78. The company has a quick ratio of 0.80, a current ratio of 0.80 and a debt-to-equity ratio of 7.82. The stock has a market cap of $33.52 billion, a P/E ratio of -36.18 and a beta of 1.45.

Roblox (NYSE:RBLX - Get Free Report) last announced its quarterly earnings data on Thursday, October 29th. The company reported ($0.32) EPS for the quarter, beating the consensus estimate of ($0.43) by $0.11. Roblox had a negative return on equity of 417.56% and a negative net margin of 16.48%. The company had revenue of $1.57 billion for the quarter, compared to the consensus estimate of $1.63 billion. During the same quarter in the prior year, the company posted ($0.37) EPS. Roblox's quarterly revenue was up 15.6% on a year-over-year basis. As a group, sell-side analysts anticipate that Roblox will post -1.36 EPS for the current year.

Insider Buying and Selling at Roblox

In other Roblox news, Director Gregory Baszucki sold 16,666 shares of the company's stock in a transaction on Thursday, October 1st. The stock was sold at an average price of $42.87, for a total value of $714,471.42. Following the completion of the sale, the director directly owned 1,252,836 shares in the company, valued at approximately $53,709,079.32. This represents a 1.31% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Sean Buckley sold 4,321 shares of the stock in a transaction on Monday, August 24th. The stock was sold at an average price of $38.68, for a total value of $167,136.28. Following the transaction, the insider directly owned 87,213 shares in the company, valued at $3,373,398.84. The trade was a 4.72% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 174,795 shares of company stock worth $6,921,031 over the last quarter. Insiders own 10.05% of the company's stock.

Institutional Inflows and Outflows

A number of institutional investors have recently added to or reduced their stakes in the business. Headlands Technologies LLC purchased a new stake in shares of Roblox in the 3rd quarter worth approximately $306,000. Empowered Funds LLC boosted its stake in shares of Roblox by 3.5% during the third quarter. Empowered Funds LLC now owns 50,264 shares of the company's stock valued at $2,130,000 after purchasing an additional 1,699 shares in the last quarter. Kovack Advisors Inc. purchased a new position in Roblox during the third quarter valued at approximately $34,000. Healthcare of Ontario Pension Plan Trust Fund increased its holdings in Roblox by 382.3% during the third quarter. Healthcare of Ontario Pension Plan Trust Fund now owns 1,544,900 shares of the company's stock valued at $65,457,000 after buying an additional 1,224,600 shares during the period. Finally, Steward Partners Investment Advisory LLC increased its holdings in Roblox by 7.9% during the third quarter. Steward Partners Investment Advisory LLC now owns 44,283 shares of the company's stock valued at $1,876,000 after buying an additional 3,244 shares during the period. Hedge funds and other institutional investors own 94.46% of the company's stock.

Top Roblox Stories

These are some of the RBLX stories that stood out recently:

• Positive Sentiment: Roblox trades at about 4.9 times sales, below its five-year average, which may appeal to investors who believe the platform’s growth prospects remain intact. Is Citi Wrong to Give Up on Roblox? It Trades at 4.9x Sales, Below Its 5-Year Average
• Neutral Sentiment: Insider Mark Reinstra sold 5,071 shares under a pre-arranged Rule 10b5-1 plan, reducing his holdings by 1.31%. The planned sale may be less informative than an unexpected transaction. Roblox insider sells shares
• Negative Sentiment: Citi’s downgrade reflects concerns about Roblox’s growth outlook. A recent analysis also highlighted bookings down 12% despite revenue rising 16%, reinforcing investor attention to demand and growth quality. Citi just downgraded Roblox stock. Here's why. Bookings down 12%, revenue up 16%—A CPA dissects Roblox

About Roblox

Roblox Corporation operates an online platform where users can create, share and play interactive 3D experiences. The company provides Roblox Studio, a set of tools that creators use to build games and other virtual spaces, as well as services for users to connect and communicate within those experiences. Roblox supports a creator economy through Robux, its virtual currency, which users can use for digital items and purchases in experiences. Eligible creators can earn revenue from their work through purchases and other platform programs.

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