Roblox (RBLX – Research Report), the Communication Services sector company, was revisited by a Wall Street analyst today. Analyst Bernie McTernan from Needham reiterated a Buy rating on the stock and has a $72.00 price target.
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Bernie McTernan has given his Buy rating due to a combination of factors, including solid growth despite high expectations and a strategic outlook on Roblox’s market share expansion. The company has shown robust growth in its mobile and desktop sectors, with a notable increase of 27% in December. This growth indicates strong underlying trends that support the company’s long-term potential. Additionally, McTernan has adjusted his medium-term margin expectations to align with the company’s strategy to capture a 10% share of the global gaming content market.
While there was a deceleration in bookings momentum, which affected the short-term bullish perspective, the strategic positioning and growth trajectory of Roblox remain compelling. The increased price target of $72 reflects confidence in the company’s ability to maintain its growth trajectory while accounting for a slight contraction in valuation multiples. Overall, McTernan’s recommendation underscores the belief in Roblox’s capacity to deliver solid growth and expand its market presence over time.
McTernan covers the Consumer Cyclical sector, focusing on stocks such as DraftKings, Super Group (SGHC), and Maplebear. According to TipRanks, McTernan has an average return of 5.1% and a 49.32% success rate on recommended stocks.
In another report released today, Morgan Stanley also maintained a Buy rating on the stock with a $75.00 price target.