.September 9, 2024 3:55 PM

MoffettNathanson analysts reiterated a Neutral rating on Roblox Corp. (NYSE:RBLX) with a $31 price target. Their valuation model includes a multi-year DCF analysis, factoring in stock-based compensation and a 26x adjusted unlevered free cash flow multiple for 2028. Roblox is heavily investing in AI, particularly generative AI, to enhance content creation on its platform. Tools like Roblox Studio and features like Roblox Party aim to improve user experience, especially on lower-end mobile devices in developing regions, while building a strong social ecosystem.

Roblox is determined to capture 10% of the global video game content market, a goal that would put it in direct competition with major players like PlayStation and surpass Nintendo. Despite facing challenges, Roblox remains ambitious and focused on expanding its reach and impact in the gaming industry.