Analyst Lacks Confidence in Roblox's Metaverse Dreams

There's room for other analysts to join the bearish bandwagon

Deputy Editor
Oct 3, 2022 at 9:17 AM
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Shares of Roblox Corp (NYSE:RBLX) are 0.8% lower premarket, last seen trading at $35.57 after MoffettNathanson initiated coverage with an "underperform" rating and a $19 price target. According to the brokerage firm, it's too early to tell if the gaming platform will actually meet its lofty Metaverse aspirations, saying in its bear note that a "huge range of outcomes could be possible."

Coming into today, the brokerage bunch was split on RBLX, leaving room for additional downgrades to pour in. Specifically, while nine consider the equity a "hold" or worse, seven still rate it a "buy" or better. What's more, the 12-month consensus target price of $44.63 is a 25.6% premium to Friday's close, indicating more price-target cuts could be right around the corner. 

For those looking to weigh in on Roblox stock, options look like a solid move at the moment. According to its Schaeffer's Volatility Scorecard (SVS)  tally of 98 out of 100, RBLX has consistently realized bigger returns than options traders have priced in over the last 12 months.

On the charts, Roblox stock continues to struggle to rebound from its May 10 all-time low of $21.65, with overhead pressure from its 180-day moving average stymying rallies in August and September. Meanwhile, RBLX sports a more than 65% year-to-date deficit.   

 
 

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