Roth Capital Upgrades Roblox (RBLX) to Buy
Roblox Corporation (NYSE:RBLX) is one of the 13 High-Risk High-Reward Growth Stocks to Invest In.
On February 9, Roth Capital upgraded its recommendation on Roblox to a Buy (from Neutral) and bumped up its target price on the stock by 7.7% to $84 (from $78). Better-than-expected guidance from management regarding bookings growth for 2026 onwards (above 20% annually over the next several years) was the main catalyst for this rating upgrade. The firm added that RBLX’s improving development tools, which lead to the production of higher-quality games and, in turn, higher revenue (a “strong, sustainable virtuous cycle,” as Roth’s analyst described it), are key to sustaining growth. Roth Capital concluded its research note by reiterating that Roblox is an attractive investment at the current share levels.
Roblox released its Q4-2025 results and 2026 guidance on February 5. According to this release, daily active users (DAU) grew 69% YoY to 144 million, while hours engaged grew even faster, up 88% YoY to 35 billion, suggesting existing users spent more time. The robust growth in operational metrics translated into rapid topline growth, with revenue up 43% YoY to $1.4 billion and bookings up 63% YoY to $2.2 billion.
The company expects the strong Q4 figures to carry over to 2026. Management guidance indicates revenue growth of 32% to 37% in Q1-2026 and 23% to 29% for the full year 2026. Bookings, meanwhile, are projected to grow 40% to 44% in Q1-2026 and 22% to 26% for the full year 2026.
Roblox Corporation (NYSE:RBLX) provides online gaming services through its platforms: Roblox Client, Roblox Studio, and Roblox Cloud. The company is based in San Mateo, California, and was founded in March 2004 by Erik Cassel and David B. Baszucki.
While we acknowledge the potential of RBLX as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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