Roblox (NYSE:RBLX) Stock Price Down 6.9% Following Analyst Downgrade

Key Points

• Piper Sandler downgrade — Roblox shares fell about 6.9% mid-day to roughly $44.28 after Piper Sandler cut its rating from overweight to neutral and slashed its price target from $100 to $50.
• Analyst sentiment is mixed but leans toward a Hold: several firms trimmed targets (UBS, HSBC, TD Cowen) while others remain more positive, and MarketBeat reports a consensus "Hold" with an average price target of $87.17.
• Notable insider selling and institutional concentration: insiders sold 551,996 shares (~$38.4M) in the last 90 days (including director sales), insiders own 12.92% of shares and hedge funds/institutions are reported to own about 94.46%.

Roblox Corporation (NYSE:RBLX - Get Free Report)'s stock price was down 6.9% during mid-day trading on Tuesday after Piper Sandler downgraded the stock from an overweight rating to a neutral rating. Piper Sandler now has a $50.00 price target on the stock, down from their previous price target of $100.00. Roblox traded as low as $44.40 and last traded at $44.2810. Approximately 9,171,498 shares traded hands during trading, a decline of 22% from the average daily volume of 11,725,756 shares. The stock had previously closed at $47.57.

A number of other analysts have also recently issued reports on RBLX. TD Cowen upgraded Roblox from a "sell" rating to a "hold" rating and decreased their target price for the stock from $54.00 to $49.00 in a report on Friday. Morgan Stanley reiterated an "overweight" rating and set a $62.00 target price on shares of Roblox in a report on Friday. HSBC cut Roblox from a "buy" rating to a "hold" rating and set a $46.00 target price for the company. in a report on Friday. Wall Street Zen upgraded Roblox from a "sell" rating to a "hold" rating in a report on Saturday, March 28th. Finally, UBS Group decreased their target price on Roblox from $74.00 to $49.00 and set a "neutral" rating for the company in a report on Friday. One analyst has rated the stock with a Strong Buy rating, twelve have assigned a Buy rating, fourteen have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, the company presently has a consensus rating of "Hold" and an average price target of $87.17.

Insider Activity

In related news, Director Gregory Baszucki sold 16,666 shares of the business's stock in a transaction that occurred on Wednesday, April 1st. The stock was sold at an average price of $57.95, for a total transaction of $965,794.70. Following the transaction, the director directly owned 1,302,834 shares of the company's stock, valued at approximately $75,499,230.30. The trade was a 1.26% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Arvind Chakravarthy sold 40,646 shares of the business's stock in a transaction that occurred on Wednesday, February 11th. The stock was sold at an average price of $67.23, for a total value of $2,732,630.58. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 551,996 shares of company stock worth $38,421,146 in the last ninety days. 12.92% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Roblox

Several institutional investors and hedge funds have recently made changes to their positions in the business. MASTERINVEST Kapitalanlage GmbH purchased a new position in shares of Roblox during the 1st quarter valued at approximately $405,000. Bleakley Financial Group LLC raised its stake in shares of Roblox by 31.0% in the 1st quarter. Bleakley Financial Group LLC now owns 22,577 shares of the company's stock valued at $1,277,000 after purchasing an additional 5,347 shares in the last quarter. Principal Financial Group Inc. raised its stake in shares of Roblox by 94.6% in the 1st quarter. Principal Financial Group Inc. now owns 27,777 shares of the company's stock valued at $1,571,000 after purchasing an additional 13,502 shares in the last quarter. J. Safra Sarasin Holding AG raised its stake in shares of Roblox by 66.1% in the 1st quarter. J. Safra Sarasin Holding AG now owns 35,931 shares of the company's stock valued at $2,032,000 after purchasing an additional 14,296 shares in the last quarter. Finally, Midwest Trust Co raised its stake in shares of Roblox by 1,038.0% in the 1st quarter. Midwest Trust Co now owns 42,016 shares of the company's stock valued at $2,376,000 after purchasing an additional 38,324 shares in the last quarter. 94.46% of the stock is currently owned by hedge funds and other institutional investors.

Roblox Trading Down 7.1%

The company has a debt-to-equity ratio of 2.45, a quick ratio of 0.89 and a current ratio of 0.89. The firm has a market cap of $29.55 billion, a price-to-earnings ratio of -28.09 and a beta of 1.50. The business's 50 day moving average price is $59.46 and its 200-day moving average price is $79.51.

Roblox (NYSE:RBLX - Get Free Report) last posted its quarterly earnings results on Thursday, April 30th. The company reported ($0.35) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.41) by $0.06. The business had revenue of $1.44 billion for 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 was up 43.4% compared to the same quarter last year. During the same period in the prior year, the company posted ($0.32) EPS. Equities analysts expect that Roblox Corporation will post -1.6 EPS for the current year.

About Roblox

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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