StoneX reiterates Roblox stock Sell rating on viral game concerns

StoneX maintained a Sell rating and $33 price target on Roblox Corp. (NYSE: RBLX) stock, indicating a significant downside from the current price of $48.09. Despite a 7.87% gain over the past week, the stock has still fallen 62% over the past year. The $33 target is at the lower end of their analyst range of $33-$65. StoneX anticipates Roblox to exceed third-quarter guidance, driven by the success of a viral game, Steal An Egg, launched on July 25.

However, they believe the outlook did not anticipate another viral hit, which could lead to a strong fourth-quarter guidance. The firm emphasizes that a brief spike in popularity due to a viral game does not establish a platform recovery or sustainable growth. StoneX remains cautious about the company's profitability this year, projecting a loss of $1.41 per share on revenue of $5.69 billion.