Roblox: Durable ‘Hit Factory’ Growth and Depressed Valuation Create Attractive Buy Opportunity

Analyst Omar Dessouky of Bank of America Securities reiterated a Buy rating on Roblox, retaining the price target of $171.00.

Omar Dessouky has given his Buy rating due to a combination of factors related to Roblox’s underlying growth engine and current valuation. He argues that the market is not fully recognizing how reliably Roblox can continue to generate new viral titles, pointing to accelerating engagement in games outside the top 10 and a growing roster of fresh hits such as The Forge, Scary Shawarma Kiosk, Fish It!, and RIVALS. His revised estimates for the fourth quarter reflect stronger platform usage and higher bookings per hour, which translate into upgraded bookings and EBITDA expectations. Dessouky also notes that recent platform changes, including age verification, have not yet shown a material drag on bookings, supporting robust near-term forecasts.
At the same time, he expects management to issue cautious 2026 guidance, largely because hit-driven businesses are inherently difficult to forecast, but sees investor expectations for that year as already restrained. In his view, the current stock price implies a valuation multiple close to its historical lows since the IPO on a two‑year forward basis, which he believes is inconsistent with Roblox’s unique strategic position within gaming and its above‑peer long‑term growth profile. His $171 price objective is based on a premium EV/EBITDA multiple relative to high‑growth software peers, which he considers warranted by the company’s distinctive platform and monetization potential. Taken together, the durability of the “hit factory” model, evidence of broadening engagement, and a depressed valuation underpin his conviction that the stock offers an attractive risk‑reward for investors.

In another report released on January 13, Morgan Stanley also maintained a Buy rating on the stock with a $155.00 price target.

Based on the recent corporate insider activity of 196 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of RBLX in relation to earlier this year.