Roblox (NYSE:RBLX) Announces Share Repurchase Plan

Roblox (NYSE:RBLX) announced that its board has initiated a share buyback program on Tuesday, May 19th, RTT News reports. The company plans to buyback $3.00 billion in outstanding shares. This buyback authorization allows the company to purchase up to 9.5% of its stock through open market purchases. Stock buyback programs are often an indication that the company’s leadership believes its shares are undervalued.

Roblox Stock Down 5.7%

Shares of NYSE:RBLX traded down $2.67 during trading hours on Tuesday, reaching $44.31. The stock had a trading volume of 14,055,317 shares, compared to its average volume of 14,596,731. Roblox has a 1 year low of $40.15 and a 1 year high of $150.59. The firm’s 50 day moving average is $54.39 and its 200-day moving average is $72.64. The company has a debt-to-equity ratio of 2.45, a quick ratio of 0.89 and a current ratio of 0.89. The stock has a market capitalization of $29.76 billion, a price-to-earnings ratio of -28.05 and a beta of 1.50.

Roblox (NYSE:RBLX) last announced its quarterly earnings data on Thursday, April 30th. The company reported ($0.35) EPS for the quarter, beating analysts’ consensus estimates of ($0.41) by $0.06. Roblox had a negative net margin of 20.69% and a negative return on equity of 277.69%. The company had revenue of $1.44 billion for the quarter, compared to the consensus estimate of $1.74 billion. During the same period in the prior year, the firm posted ($0.32) EPS. The company’s quarterly revenue was up 43.4% compared to the same quarter last year. Research analysts predict that Roblox will post -1.4 earnings per share for the current fiscal year.

Analyst Ratings Changes

A number of research firms have issued reports on RBLX. Canaccord Genuity Group reduced their target price on shares of Roblox from $140.00 to $80.00 and set a “buy” rating on the stock in a report on Friday, May 1st. Jefferies Financial Group lowered shares of Roblox from a “hold” rating to a “hold” rating in a report on Friday, May 1st. Morgan Stanley reissued an “overweight” rating and issued a $62.00 price objective on shares of Roblox in a research report on Friday, May 1st. Needham & Company LLC began coverage on shares of Roblox in a research report on Friday, May 1st. They issued a “buy” rating and a $60.00 price objective on the stock. Finally, Citigroup dropped their price objective on shares of Roblox from $90.00 to $70.00 and set a “buy” rating on the stock in a research report on Monday, May 4th. One analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating, fourteen have issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, Roblox presently has a consensus rating of “Hold” and a consensus price target of $87.17.

Insider Activity at Roblox

In related news, insider Mark Reinstra sold 18,653 shares of the company’s stock in a transaction dated Monday, April 13th. The stock was sold at an average price of $57.94, for a total value of $1,080,754.82. Following the completion of the sale, the insider directly owned 455,473 shares of the company’s stock, valued at $26,390,105.62. This represents a 3.93% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Gregory Baszucki sold 16,666 shares of the firm’s stock in a transaction that occurred on Tuesday, May 5th. The stock was sold at an average price of $44.97, for a total value of $749,470.02. Following the transaction, the director owned 1,294,501 shares in the company, valued at $58,213,709.97. This represents a 1.27% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 76,144 shares of company stock valued at $4,235,769 in the last ninety days. 10.05% of the stock is currently owned by insiders.

Roblox Company Profile

Roblox Corporation operates Roblox, a user-generated online platform that enables people to create, share and monetize immersive 3D experiences and games. The core offering centers on Roblox Studio, a development environment that allows independent creators and studios to design interactive worlds using the company’s building tools and scripting language. Content on the platform spans games, virtual hangouts, branded experiences and live events, all delivered through a persistent social environment.

Roblox’s business model is built around its virtual economy and creator ecosystem.