Roblox (NYSE:RBLX) Trading Up 7% – Time to Buy?

Roblox Corporation (NYSE:RBLX)’s stock price was up 7% during trading on Monday . The company traded as high as $55.26 and last traded at $55.2860. 3,866,458 shares were traded during mid-day trading, a decline of 66% from the average daily volume of 11,433,381 shares. The stock had previously closed at $51.68.

Analyst Upgrades and Downgrades

A number of equities analysts recently issued reports on RBLX shares. Deutsche Bank Aktiengesellschaft assumed coverage on Roblox in a report on Monday, June 29th. They set a “buy” rating on the stock. The Goldman Sachs Group decreased their price objective on Roblox from $125.00 to $65.00 and set a “buy” rating for the company in a research report on Friday, May 1st. Jefferies Financial Group downgraded Roblox from a “hold” rating to a “hold” rating in a research note on Friday, May 1st. Morgan Stanley reissued an “overweight” rating and issued a $62.00 target price on shares of Roblox in a report on Friday, May 1st. Finally, Oppenheimer began coverage on Roblox in a research note on Friday, May 1st. They set an “outperform” rating for the company. One investment analyst has rated the stock with a Strong Buy rating, seventeen have given a Buy rating, eleven have given a Hold rating and one has assigned a Sell rating to the company’s stock. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $85.48.

Roblox Stock Performance

The stock’s 50-day moving average is $48.48 and its 200 day moving average is $58.90. The stock has a market cap of $36.49 billion, a price-to-earnings ratio of -34.37 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 released its earnings results on Thursday, April 30th. The company reported ($0.35) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.41) by $0.06. The company had revenue of $1.44 billion for the quarter, compared to analysts’ expectations of $1.74 billion. Roblox had a negative return on equity of 277.69% and a negative net margin of 20.69%.The firm’s quarterly revenue was up 43.4% on a year-over-year basis. During the same quarter in the previous year, the firm posted ($0.32) EPS. As a group, analysts predict that Roblox Corporation will post -1.39 earnings per share for the current fiscal year.

Roblox declared that its Board of Directors has authorized a share buyback program on Tuesday, May 19th that allows the company to buyback $3.00 billion in outstanding shares. This buyback authorization allows the company to buy up to 9.5% of its shares through open market purchases. Shares buyback programs are typically a sign that the company’s board of directors believes its stock is undervalued.

Insider Transactions at Roblox

In other news, insider Matthew D. Kaufman sold 14,356 shares of the company’s stock in a transaction on Wednesday, May 20th. The shares were sold at an average price of $45.27, for a total transaction of $649,896.12. Following the transaction, the insider directly owned 349,964 shares of the company’s stock, valued at $15,842,870.28. This represents a 3.94% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. 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 firm’s stock in a transaction dated Tuesday, May 5th. The shares were sold at an average price of $44.97, for a total transaction of $749,470.02. Following the completion of 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 disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 161,983 shares of company stock valued at $7,580,990 in the last three months. Insiders own 10.05% of the company’s stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Reyes Financial Architecture Inc. raised its holdings in Roblox by 164.4% during the fourth quarter. Reyes Financial Architecture Inc. now owns 312 shares of the company’s stock worth $25,000 after purchasing an additional 194 shares during the last quarter. Hanson & Doremus Investment Management purchased a new position in shares of Roblox in the first quarter valued at $25,000. Fideuram Asset Management Ireland dac acquired a new position in shares of Roblox during the 4th quarter worth $27,000. Basecamp Wealth Advisors LLC raised its stake 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 during the last quarter. Finally, GW&K Investment Management LLC grew its stake in Roblox by 76.3% in the 4th quarter. GW&K Investment Management LLC now owns 372 shares of the company’s stock valued at $30,000 after acquiring an additional 161 shares during the last quarter. 94.46% of the stock is currently owned by institutional investors and hedge funds.

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.