Benchmark Research Upgrades Roblox Corp. (RBLX:NYE) to a “Buy” rating

Roblox Corp Stock Forecast:

Based on a forecast from 33 analysts, the average analyst target price for Roblox Corp over the next 12 months is USD 37.35, with an average analyst rating of Buy. Stock Target Advisor‘s own analysis of Roblox Corp is Slightly Bullish, with 5 positive signals and 4 negative signals. Roblox Corp’s stock price at the last closing was USD 38.87, which has increased by +13.56% over the past week, decreased by -16.28% over the past month, and increased by +67.62% over the last year.

Analysts Coverage Change:

  • BTIG (RANK #44) maintains a “Buy” rating on Roblox (RBLX:NYE) and increases their target price from to $60 form $55.
  • Benchmark Research (RANK #53) Upgrades their rating on Roblox from a “Hold” to a “Buy” with a target price of $45.

Roblox Corp. News:

Roblox, a video game company, reported its first-quarter results, leading to a 6% increase in its shares on Wednesday morning. The company’s revenue, known as bookings, was reported to be $774 million, surpassing the expected $766 million, according to Refinitiv. However, the loss per share was 44 cents, which was higher than the anticipated 40 cents per share, as per the Refinitiv survey of analysts.

Roblox’s average daily active users (DAUs) saw a 22% year-over-year increase, with 66 million DAUs and 14.5 billion engagement hours, up 23% from the previous year. The growth in both DAUs and engagement hours was most significant among Roblox’s international and 13-and-older segments, marking an all-time high for the company.

Founder and CEO David Baszucki credited the company’s bookings growth to its “eight quarters of innovation and awesome engineering” during the analyst call that followed the earnings report. The company’s earnings release noted that while users of all ages are growing, older users between the ages of 17-24 contributed the most, with a 35% increase in Q1 2023 over Q1 2022.

Roblox reported a net loss of $268 million for the quarter, compared to a net loss of $160.2 million in the year-ago quarter. Despite the broader downturn in tech spending and hiring, the company signaled that it was comfortable with its present headcount and compensation levels, given the momentum seen in bookings. Roblox saw its adjusted revenue, or bookings, grow by 23% year over year.

The company expects bookings growth to exceed compensation growth in the first fiscal quarter of 2024 and onward, allowing it to slow down its year-over-year increases in headcount and compensation expenses.

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