Wedbush Cuts Roblox Price Target to $110 Amid Analyst Insights

Analysts at Wedbush have reduced their price target for Roblox Corporation (NYSE:RBLX) from $165.00 to $110.00. This revision, announced in a research report issued on October 30, 2023, retains an “outperform” rating for the stock, suggesting a potential upside of 63.37% based on its previous closing price.

Several other financial firms have also recently evaluated Roblox’s market position. B. Riley initiated coverage on the stock, assigning a “buy” rating with a target price of $125.00. Meanwhile, Barclays increased its target from $120.00 to $130.00, maintaining an “equal weight” rating. Jefferies Financial Group set a target price of $85.00, while Wolfe Research established a price target of $100.00. Macquarie raised its price objective from $158.00 to $164.00, also awarding the company an “outperform” rating.

Overall, the stock has received a mixed response from analysts. According to MarketBeat, 17 research analysts have rated Roblox as a “buy,” 8 have given it a “hold” rating, and 3 analysts have classified it as a “sell.” The consensus rating currently stands at “Moderate Buy” with an average price target of $131.65.

Roblox Earnings Report Details

Roblox released its most recent earnings report on October 30, 2023. The company reported an earnings per share (EPS) of ($0.37), surpassing the consensus estimate of ($0.44) by $0.07. Revenue for the quarter reached $1.36 billion, falling short of expectations that had estimated $1.64 billion. The company faced a negative net margin of 21.70% and a return on equity of (314.20%). Notably, Roblox’s revenue showed a significant increase of 70.3% compared to the same period last year.

Equities analysts predict that Roblox will report an EPS of ($1.49) for the current fiscal year.

Insider Trading Activity

In related news, CFO Naveen K. Chopra sold 19,424 shares of Roblox on November 20, 2023, at an average price of $95.23. This transaction totaled approximately $1.85 million and reduced Chopra’s holdings to 337,036 shares, valued at approximately $32.1 million, reflecting a 5.45% decrease in his stock position.

Director Anthony P. Lee also sold 7,000 shares on January 13, 2024, for a total value of $577,150. He now holds 256,768 shares, valued at around $21.17 million, marking a 2.65% decrease in his ownership. Recent insider transactions indicate that insiders have sold a total of 504,300 shares worth $46.29 million in the last three months, with insiders collectively owning 12.92% of the company.

Institutional Investor Movements

Recent trading activity has seen notable movements among institutional investors. Vanguard Group Inc. raised its holdings in Roblox by 1.6% during the fourth quarter, now owning 63,458,784 shares valued at $5.14 billion. State Street Corp increased its stake by 11.0% in the third quarter, bringing its total to 13,369,844 shares worth $1.85 billion.

Geode Capital Management LLC raised its position by 9.1%, now holding 10,039,983 shares valued at $1.05 billion. AQR Capital Management LLC increased its holdings by 7.4%, owning 9,697,538 shares valued at $1.31 billion. Franklin Resources Inc. also boosted its stake by 9.8%, acquiring 6,963,693 shares worth $964.61 million. Currently, institutional investors and hedge funds own approximately 94.46% of Roblox’s stock.

Roblox Corporation operates a user-generated online platform where users can create, share, and monetize immersive 3D experiences and games. Its primary offering is Roblox Studio, a development environment that enables creators to design interactive worlds using the company’s tools and scripting language. The platform features a variety of content, including games, virtual hangouts, and live events, all within a persistent social environment. The company’s business model revolves around its virtual economy and the ecosystem of its creators.

This financial landscape continues to evolve, as analysts and investors closely monitor Roblox’s performance amid changing market conditions.