why roblox stock down

Full Answer

Should you buy Roblox stock right now?

They just revealed what they believe are the ten best stocks for investors to buy right now... and Roblox Corporation wasn't one of them! That's right -- they think these 10 stocks are even better buys. Rich Smith owns shares of Roblox Corporation. The Motley Fool owns shares of and recommends Roblox Corporation.

Is Roblox stock poised to rally soon?

So there is sort of a pause in that rally," Fiona Cincotta ... flat as a pancake after gains in travel-related and healthcare stocks offset commodity-linked weakness. Positive headlines on ...

Is it too late to buy Roblox stock?

Roblox has a market capitalization of US$37b, so it's too big to fly under the radar ... It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you ...

Is Roblox stock a good investment?

Since the Roblox IPO, the stock is up more than 60% and the company’s value is more than $40 billion. And now Wall Street analysts are pushing the interest even further after Stifel’s rating was released. In the long run, Roblox is looking more like a safe play for investors. But there are risks to consider. Roblox put together a strong 2020 which will unlikely be comparable to 2021.

Is Roblox stock worth buying?

Take the market with you Roblox reported having 32.6 million daily active users at the end of 2020, up 85% from the year-ago period. Revenue jumped 82% in the year to $924 million. It had a net loss of $253 million in 2020, vs. a $71 million loss in the prior year, according to the Roblox IPO filing.

Is Roblox stock expected to rise?

Stock Price Forecast The 16 analysts offering 12-month price forecasts for Roblox Corp have a median target of 34.00, with a high estimate of 61.00 and a low estimate of 21.00.

Can Roblox stock recover?

A rebound in RBLX's shares is likely to happen in 2H 2022, when the company's bookings growth accelerate again benefiting from an easier base for comparison. But a recovery to the $70 price level is quite challenging considering the implied valuation multiples and the weakness in Roblox's US & Canada region.

What happened Roblox stock?

Roblox stock is 8.7% lower today in response to a downgrade from Atlantic Equities, while Snap -- the name behind the social media app Snapchat -- cautioned its shareholders that it wouldn't meet its initial second-quarter earnings estimates, sending its shares down more than 40%.

How high will RBLX go?

However, investors shouldn't forget that Roblox's current pace of growth remains quite solid. Assuming the company maintains the $200 million revenue run rate that it has clocked in the first two months of 2022, it could end 2022 with $2.4 billion in revenue.

What will Roblox look like in 2030?

Roblox went public via a direct listing this March with a reference price of $45. The stock opened at $64.50, and currently trades in the high $80s -- which gives it a market capitalization of nearly $50 billion. For Roblox to become a $1 trillion company by 2030, the stock would need to rise about 20 times.

Is Roblox time to buy?

Shareholders will need more patience betting on Roblox's strong prospects. The company is a great buy as young gamers spend more time on the platform. But even after falling from the $141.60 high set in November 2021, the stock could get cheaper. The market will remain irrational longer than some will expect.

Did Google bought Roblox?

Today at 3pm, internet search giant Google announced its aquistion of startup game studio Roblox for a purchase price of 380 million dollars. Roblox is an online building game for kids.

Who owns Roblox now 2020?

Roblox Corporation is an American video game developer based in San Mateo, California. Founded in 2004 by David Baszucki and Erik Cassel, the company is the developer of Roblox, which was released in 2006. As of December 31, 2021, Roblox Corporation employs approximately 1,600 people.

What happened

Shares of Roblox (NYSE: RBLX) were down 9.8% as of 10:32 a.m. ET on Wednesday, following the release of November engagement metrics.

So what

Investors were disappointed to see slowing growth in daily active users (DAUs) and time spent on the platform -- two key operating metrics that investors closely watch for insights about how well Roblox is attracting and retaining users.

Now what

The most important outcome of slowing engagement trends is how it impacts user monetization, since the more time spent on the platform is supposed to correlate to higher sales of Robux, the virtual currency used to unlock new experiences on the platform.

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NYSE: RBLX

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Roblox's long-term prospects look promising, but there are some short-term concerns

Online game platform and game creation system Roblox ( RBLX -8.75% ) has performed well since its direct listing last year -- its shares began trading at around $60 and subsequently more than doubled over the next few months to hit a high of $141.60.

A solid quarterly result but with weaker growth

The COVID-19 pandemic has been disrupting industries of all kinds, especially airlines and hospitality, for almost two years now. For some companies though, COVID-19 has actually helped accelerate growth.

NYSE: RBLX

While solid, these numbers were weaker when compared to the previous quarters. For perspective, revenue grew 127% and 140%, respectively, in the prior two quarters. Besides, Roblox reported that total engagement hours in November 2021 -- while up 32% year over year -- came in weaker than the 4 billion hours clocked in August 2021.

Investors are moving away from growth stocks

The last two years were a great time to own growth stocks, with highflyers like Tesla rising more than tenfold between 2020 and 2021. The rising tide, however, has been lowered toward the second half of last year.

What's next for Roblox

Overall, Roblox's weaker growth and the change in investor sentiments toward high growth (but loss-making stocks) likely caused its share price to fall. Still, the company's long-term prospects remain largely intact.

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What happened

Shares of Roblox ( RBLX -8.68% ) were down 18.4% week to date through Thursday's close, according to data provided by S&P Global Market Intelligence. In its latest fourth-quarter report, the gaming platform posted decelerating growth in key operating metrics and issued a weak outlook for the year ahead.

So what

The more important metric that analysts watch is bookings, a non-GAAP (adjusted) measure of revenue. Growth in this metric has decelerated significantly over the last four quarters, from 161% in the year-ago quarter to just 20% in the fourth quarter.

Now what

These are likely just near-term speed bumps, as Roblox laps spikes in demand a year ago. While bookings growth is slowing, it's important to remember that time spent on the platform is still above 10 billion hours, which is close to record highs for the company. Overall, the collapse in the share price can be blamed on valuation concerns.