Oppenheimer Thinks Roblox Stock Can Rise Back to Multiyear Highs

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Roblox has attracted users with the 'Grow a Garden' game. ### Key Takeaways

• Oppenheimer raised its price target for Roblox shares to $125, a number its shares haven't been near since late 2021.
• The analysts said the gaming platform's algorithm will give it an edge in identifying trends in an era where studios act more like game publishers, than creators.
• Roblox shares have surged this year as the platform's Grow a Garden game attracted record numbers of players.

One of Wall Street’s biggest Roblox bulls sees its shares hitting highs not seen in years.

Oppenheimer on Wednesday raised its price target for Roblox Corp. (RBLX) stock from $80 to $125, a level the shares haven’t hit since late 2021. The online gaming platform has “a better solution to user growth and user retention than most game publishers,” Oppenheimer wrote.

Roblox is unlikely to discover another Grow a Garden, a blockbuster, agricultural-themed game that Roblox bought a stake in when it had a promising number of players, analysts said. At one point, 16.4 million users were simultaneously playing Grow a Garden, surpassing Fortnite’s peak concurrent player count, according to The New York Times.

But Roblox’s recommendation algorithm will likely give it an edge in the TikTok era, where gaming “trends emerge organically” and studios must “play catch-up,” Oppenheimer said. Studios are moving toward “a game publisher model, where they spend more time on identifying trends and scouting and investing in promising creators, than developing inhouse games,” the analysts said.

Oppenheimer’s price is well above the $85.31 average of analysts who follow the online gaming platform and who were polled by Visible Alpha.

Roblox was recently up about 1% to a bit over $102, having gained more than 75% so far this year.

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