TD Cowen Cuts Roblox (NYSE:RBLX) Price Target to $40.00

Roblox (NYSE:RBLX) had its price target dropped by equities researchers at TD Cowen from $49.00 to $40.00 in a report issued on Friday,Benzinga reports. The brokerage presently has a “hold” rating on the stock. TD Cowen’s price objective would suggest a potential upside of 16.60% from the stock’s previous close.

Other research analysts also recently issued research reports about the stock. Benchmark downgraded shares of Roblox from a “hold” rating to a “sell” rating and set a $33.00 target price on the stock. in a research report on Friday. Roth Capital set a $65.00 price objective on shares of Roblox in a report on Tuesday, May 5th. Seaport Research Partners cut shares of Roblox to a “neutral” rating in a research report on Monday, June 29th. Bank of America downgraded Roblox from a “buy” rating to a “neutral” rating and set a $48.00 target price for the company. in a research note on Friday, May 1st. Finally, DA Davidson set a $40.00 target price on Roblox in a research report on Friday. One analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating, thirteen have given a Hold rating and four have given a Sell rating to the company’s stock. Based on data from MarketBeat, the company has an average rating of “Hold” and an average target price of $67.04.

Roblox Trading Down 29.5%

Shares of Roblox stock traded down $14.37 on Friday, hitting $34.30. 41,520,795 shares of the company’s stock traded hands, compared to its average volume of 11,514,866. The company has a fifty day moving average of $49.53 and a two-hundred day moving average of $57.08. Roblox has a one year low of $33.88 and a one year high of $150.59. The company has a market capitalization of $23.04 billion, a price-to-earnings ratio of -21.85 and a beta of 1.41. 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 issued its earnings results on Thursday, July 30th. The company reported ($0.26) earnings per share for the quarter, topping analysts’ consensus estimates of ($0.34) by $0.08. Roblox had a negative return on equity of 277.69% and a negative net margin of 20.69%.The business had revenue of $1.47 billion during the quarter, compared to the consensus estimate of $1.60 billion. The firm’s revenue for the quarter was up 8.3% on a year-over-year basis. During the same period in the previous year, the company posted ($0.41) earnings per share. As a group, sell-side analysts expect that Roblox will post -1.39 earnings per share for the current year.

Roblox declared that its Board of Directors has authorized a stock buyback plan on Tuesday, May 19th that allows the company to repurchase $3.00 billion in outstanding shares. This repurchase authorization allows the company to buy up to 9.5% of its shares through open market purchases. Shares repurchase plans are often an indication that the company’s board believes its shares are undervalued.

Insider Buying and Selling at Roblox

In related news, insider Mark Reinstra sold 17,275 shares of Roblox stock in a transaction that occurred on Wednesday, May 20th. The stock was sold at an average price of $45.28, for a total transaction of $782,212.00. Following the transaction, the insider owned 438,198 shares of the company’s stock, valued at $19,841,605.44. The trade was a 3.79% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Gregory Baszucki sold 16,666 shares of the company’s stock in a transaction on Tuesday, May 5th. The stock was sold at an average price of $44.97, for a total value of $749,470.02. Following the sale, the director owned 1,294,501 shares of the company’s stock, valued at $58,213,709.97. This trade represents a 1.27% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 161,983 shares of company stock worth $7,580,990. 10.05% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Roblox

Several large investors have recently bought and sold shares of the stock. Reyes Financial Architecture Inc. raised its holdings in shares of Roblox by 164.4% in the fourth quarter. Reyes Financial Architecture Inc. now owns 312 shares of the company’s stock valued at $25,000 after purchasing an additional 194 shares during the last quarter. Hanson & Doremus Investment Management bought a new stake in Roblox in the 1st quarter worth about $25,000. Fideuram Asset Management Ireland dac purchased a new stake in Roblox in the 4th quarter valued at about $27,000. Basecamp Wealth Advisors LLC lifted its position in shares of Roblox by 98.8% during the 1st quarter. Basecamp Wealth Advisors LLC now owns 507 shares of the company’s stock worth $29,000 after buying an additional 252 shares in the last quarter. Finally, GW&K Investment Management LLC boosted its stake in shares of Roblox by 76.3% in the 4th quarter. GW&K Investment Management LLC now owns 372 shares of the company’s stock worth $30,000 after buying an additional 161 shares during 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 reported a narrower-than-expected second-quarter loss of $0.26 per share, compared with the consensus estimate of a $0.34 loss and a $0.41 loss in the year-ago quarter. Revenue increased 8.3% year over year to $1.47 billion. Roblox Q2 earnings results
• Positive Sentiment: Management highlighted an expansion of artificial-intelligence creation tools and broader gaming initiatives, which could support developer activity, content supply and longer-term monetization if successfully implemented. Roblox Q2 earnings call highlights
• Positive Sentiment: Daily active users grew 10% year over year, indicating that Roblox continues to expand its audience despite recent engagement and discovery challenges. Roblox DAU growth
• Neutral Sentiment: Wedbush reaffirmed its Neutral rating but reduced its price target from $65 to $40, reflecting lower near-term expectations while still implying potential upside from recently depressed levels. Roblox analyst price-target changes
• Negative Sentiment: Third-quarter bookings guidance of $1.58 billion to $1.65 billion fell below Wall Street expectations. The company also projected revenue growth of only 4% to 10%, a slowdown from recent double-digit growth. Roblox bookings forecast
• Negative Sentiment: Stricter age-verification and safety changes are weighing on onboarding and engagement, while discovery and monetization adjustments are creating uncertainty around bookings growth. Roblox quarterly bookings outlook
• Negative Sentiment: Several analysts cut their forecasts after the earnings report, and media reports indicated that at least two firms assigned Sell ratings. This signals deteriorating confidence in Roblox’s near-term growth and monetization outlook. Roblox analyst downgrades
• Negative Sentiment: Multiple law firms announced or promoted securities-fraud class-action proceedings tied to alleged disclosures surrounding Roblox’s platform and age-verification impact. The allegations are not proven, but the litigation adds reputational and legal overhang. Roblox securities class action notice

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.