Roblox Corporation (NYSE:RBLX) shares are surging on Tuesday, reflecting a positive move in a generally weak market. The stock is up approximately 5.8% on Tuesday versus a -0.4% loss in the Technology sector and a 0.3% loss in the S&P 500.
Roblox shares may be getting a lift after BMO Capital reiterated an Outperform rating on the stock this week with a price target of $155, representing nearly 100% upside from trading levels at the time of publication.
Other recent analyst updates include a Neutral from JPMorgan with a price target of $100, a Hold from Jefferies with a price target of $100 and a Buy rating from B. Riley with a price target of $125.
Roblox Defies Broader Market Trends
The upward movement in Roblox’s stock comes amid a mixed performance in the broader market, with major indices like the Nasdaq and S&P 500 showing slight declines. This suggests that Roblox’s gains may be driven by company-specific factors rather than overall market trends.
The stock’s performance stands out as the Technology sector struggles, with the Nasdaq down 0.35% and the S&P 500 down 0.25%. This divergence indicates that traders may be reacting positively to Roblox’s recent performance or outlook.
Mixed Technical Indicators For RBLX
Roblox is currently trading 0.04% below its 20-day simple moving average (SMA) and 25.3% below its 100-day SMA, indicating some short-term weakness while still reflecting a longer-term downtrend. Shares have increased 35.03% over the past 12 months and are currently positioned closer to their 52-week highs than lows, suggesting a recovery from earlier lows.
The RSI is at 31.37, which is considered neutral territory, indicating that the stock is not in overbought or oversold conditions. Meanwhile, MACD is above its signal line, indicating bullish momentum, which could support the current price action.
The combination of neutral RSI and bullish MACD suggests mixed momentum, indicating potential for further gains if buying interest continues.
- Key Resistance: N/A
- Key Support: $80.50
Earnings On The Horizon
Investors are looking ahead to the next earnings report on Feb. 5, which the company scheduled on Monday.
- EPS Estimate: $-0.48 (Down from $-0.33 YoY)
- Revenue Estimate: $2.07 billion (Up from $1.36 billion YoY)
Benzinga Edge Ranking
Below is the Benzinga Edge scorecard for Roblox, highlighting its strengths and weaknesses compared to the broader market:
- Momentum: Bearish (Score: 21.36/100) — The stock is underperforming relative to the broader market.
The Verdict: Roblox’s Benzinga Edge signal reveals a challenging momentum situation. While the stock has shown some recovery, the low momentum score indicates that it may struggle to maintain upward momentum without significant buying interest.
Top ETF Exposure
- ARK Innovation ETF (NYSE:ARKK): 3.72% Weight
- VanEck Video Gaming and eSports ETF (NASDAQ:ESPO): 5.34% Weight
- Roundhill Ball Metaverse ETF (NYSE:METV): 6.06% Weight
Significance: Because RBLX carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
RBLX Shares Rally
RBLX Price Action: Roblox shares were up 7.82% at $82.75 at the time of publication on Tuesday, according to Benzinga Pro data.
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