AXQ Capital LP Grows Stake in Roblox Corporation $RBLX

Key Points

• AXQ Capital LP dramatically increased its Roblox stake by 662.6% in the fourth quarter, ending with 29,110 shares valued at about $2.36 million. Roblox now ranks as the fund’s 16th largest holding.
• Roblox authorized a $3 billion stock buyback covering up to 9.5% of its shares, a move often interpreted as management signaling confidence that the stock may be undervalued.
• Recent results showed mixed fundamentals: Roblox beat EPS estimates for the quarter but missed revenue expectations, while analysts currently rate the stock a consensus “Hold” with a target price of $87.07.

AXQ Capital LP lifted its position in Roblox Corporation (NYSE:RBLX - Free Report) by 662.6% during the fourth quarter, according to the company in its most recent filing with the Securities and Exchange Commission (SEC). The fund owned 29,110 shares of the company's stock after buying an additional 25,293 shares during the period. Roblox makes up about 0.5% of AXQ Capital LP's investment portfolio, making the stock its 16th biggest position. AXQ Capital LP's holdings in Roblox were worth $2,359,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds have also recently modified their holdings of RBLX. Sunbelt Securities Inc. raised its holdings in Roblox by 58.7% in the 3rd quarter. Sunbelt Securities Inc. now owns 284 shares of the company's stock worth $39,000 after purchasing an additional 105 shares during the period. Horizon Investments LLC grew its position in Roblox by 2,636.4% in the third quarter. Horizon Investments LLC now owns 301 shares of the company's stock worth $42,000 after acquiring an additional 290 shares in the last quarter. Reyes Financial Architecture Inc. grew its position in Roblox by 164.4% in the fourth quarter. Reyes Financial Architecture Inc. now owns 312 shares of the company's stock worth $25,000 after acquiring an additional 194 shares in the last quarter. Fideuram Asset Management Ireland dac purchased a new position in shares of Roblox during the fourth quarter valued at approximately $27,000. Finally, Indiana Trust & Investment Management Co purchased a new position in shares of Roblox during the fourth quarter valued at approximately $32,000. 94.46% of the stock is currently owned by hedge funds and other institutional investors.

Roblox Price Performance

RBLX stock opened at $47.02 on Tuesday. The stock has a market capitalization of $31.58 billion, a PE ratio of -29.76 and a beta of 1.44. The company's 50-day moving average is $52.27 and its 200-day moving average is $68.85. 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 Corporation has a 1 year low of $40.15 and a 1 year high of $150.59.

Roblox (NYSE:RBLX - Get Free Report) last posted its earnings results on Thursday, April 30th. The company reported ($0.35) earnings per share for the quarter, topping analysts' consensus estimates of ($0.41) by $0.06. The company had revenue of $1.44 billion for the quarter, compared to analyst estimates of $1.74 billion. Roblox had a negative net margin of 20.69% and a negative return on equity of 277.69%. The firm's revenue was up 43.4% compared to the same quarter last year. During the same quarter in the prior year, the business posted ($0.32) EPS. Equities research analysts expect that Roblox Corporation will post -1.4 EPS for the current fiscal year.

Roblox declared that its board has authorized a stock repurchase plan on Tuesday, May 19th that authorizes the company to buyback $3.00 billion in shares. This buyback authorization authorizes the company to repurchase up to 9.5% of its shares through open market purchases. Shares buyback plans are typically a sign that the company's leadership believes its shares are undervalued.

Insider Transactions at Roblox

In other Roblox news, CFO Naveen K. Chopra sold 16,863 shares of the business's stock in a transaction dated Wednesday, May 20th. The shares were sold at an average price of $45.28, for a total value of $763,556.64. Following the transaction, the chief financial officer owned 380,758 shares in the company, valued at approximately $17,240,722.24. The trade was a 4.24% decrease in their ownership of the stock. The transaction was disclosed in a legal filing 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 Matthew D. Kaufman sold 14,356 shares of Roblox stock in a transaction dated Wednesday, May 20th. The shares were sold at an average price of $45.27, for a total transaction of $649,896.12. Following the sale, the insider directly owned 349,964 shares in the company, valued at $15,842,870.28. The trade was a 3.94% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last three months, insiders have sold 183,471 shares of company stock valued at $8,930,068. Company insiders own 10.05% of the company's stock.

Analyst Upgrades and Downgrades

Several brokerages have issued reports on RBLX. Raymond James Financial lowered Roblox from an "outperform" rating to a "market perform" rating in a research report on Friday, May 1st. BMO Capital Markets reissued an "outperform" rating on shares of Roblox in a research note on Friday, February 6th. Barclays dropped their price objective on Roblox from $115.00 to $60.00 and set an "equal weight" rating on the stock in a research note on Friday, May 1st. Jefferies Financial Group cut Roblox from a "hold" rating to a "hold" rating in a research note on Friday, May 1st. Finally, Piper Sandler cut Roblox from an "overweight" rating to a "neutral" rating and dropped their price objective for the stock from $100.00 to $50.00 in a research note on Monday, May 4th. One investment analyst has rated the stock with a Strong Buy rating, twelve have assigned a Buy rating, fourteen have issued a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat.com, the company has a consensus rating of "Hold" and a consensus target price of $87.07.

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.

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