About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, The ...

Core Viewpoint - Hindenburg Research has released a report alleging that Roblox has inflated its user metrics, which could pose risks for advertisers and the company's reputation [1][3]. Group 1: Allegations of Inflated Metrics - Hindenburg Research claims that Roblox has overstated its daily active users (DAUs) by 25% to 42% to attract advertisers, suggesting that the actual user growth is stalling [3]. - Roblox asserts it has over 65 million DAUs, but Hindenburg indicates these figures may be exaggerated, with evidence of bots allowing individuals to manage multiple accounts [3]. - Roblox's disclosures state that DAUs are not a measure of unique individuals, and former employees have indicated that the company tracks multiple accounts internally [3][4]. Group 2: Engagement Metrics Concerns - The report questions Roblox's claim of an average engagement of 2.4 hours per user per day, which is 58% higher than the average gaming time for its target demographic of 8 to 12-year-olds [4]. - If accurate, this engagement metric would surpass popular social media platforms by 26% to 166%, raising further doubts about its legitimacy [4]. Group 3: Risks for Advertisers - The inflated metrics could undermine advertiser confidence, threatening a significant revenue stream for Roblox [5]. - Companies may face lower returns on ad spend and reputational risks by associating with Roblox, especially given the presence of inappropriate content on the platform [5]. Group 4: Insider Activity and Management Changes - There has been a notable increase in insider selling over the past year, alongside the resignation of key executives, including the CFO, CTO, and CMCO [5][6]. - The overall outlook for Roblox appears bleak, with potential regulatory scrutiny and investor mistrust likely to follow the report's findings [6].

In early trading, Roblox (RBLX, Financial) saw its stock price dip over 9.3%, reaching a low of $37.51, before narrowing its losses to around 5%. The volatility comes as Hindenburg Research, a well-known short-selling firm, announced its short position on the company. The firm accuses Roblox of misstating the number of users on its platform to both investors and regulators. ...

Topline Influential short seller Hindenburg Research revealed Tuesday it took a short position against kids-oriented video game platform Roblox, accusing the company of inflating key metrics of user engagement and of inadequately protecting children from disturbing content, causing Roblox's share price to tumble. Roblox went public in 2021, and had a roughly $25 billion market value as of Tuesday, about a third ... [+] of its peak valuation of more than $75 billion in late 2021 as its share price faded alon ...

Roblox (RBLX) could be a solid choice for investors given its recent upgrade to a Zacks Rank #2 (Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change. The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system. Since a changing e ...

The most recent trading session ended with Roblox (RBLX) standing at $41.99, reflecting a -0.45% shift from the previouse trading day's closing. The stock's change was less than the S&P 500's daily gain of 0.9%. Elsewhere, the Dow saw an upswing of 0.81%, while the tech-heavy Nasdaq appreciated by 1.22%. Heading into today, shares of the online gaming platform had lost 3.5% over the past month, lagging the Consumer Discretionary sector's gain of 4.88% and the S&P 500's gain of 3.15% in that time. The invest ...

Company Analysis - Roblox Corporation (NYSE: RBLX) received a strong buy rating due to its hyper growth rates in bookings and potential revenue streams from advertising [1] - Since the initiation of coverage, the stock has increased by nearly 10% [1] Analyst Background - The analyst has a background as a former managing editor at a financial media publication focused on mid and small caps [1] - The analyst utilizes experience in financial markets and institutions to identify undervalued companies and provide thorough research and analysis of financial statements, market trends, and upcoming events [1]

Company Performance - Roblox (RBLX) closed at $44.18, reflecting a -1.54% change from the previous day, underperforming the S&P 500's daily loss of 0.13% [1] - The stock has increased by 2.98% over the past month, which is below the Consumer Discretionary sector's gain of 4.45% and slightly above the S&P 500's gain of 2.43% [1] Upcoming Financial Results - Roblox is expected to report earnings of -$0.39 per share, indicating a year-over-year growth of 13.33% [2] - The revenue forecast for the upcoming quarter is $1.02 billion, representing a 21.19% increase compared to the same quarter last year [2] Full Year Projections - For the full year, earnings are projected at -$1.59 per share and revenue at $4.22 billion, showing year-over-year changes of +14.97% and +19.83%, respectively [3] - Recent analyst estimate revisions are seen as a positive indicator for the company's business outlook [3] Analyst Ratings and Market Trends - The Zacks Rank system, which evaluates estimate changes, currently ranks Roblox at 3 (Hold) [5] - The consensus EPS projection has increased by 0.11% in the past 30 days [5] Industry Context - The Gaming industry, part of the Consumer Discretionary sector, holds a Zacks Industry Rank of 148, placing it in the bottom 42% of over 250 industries [6] - Research indicates that top-rated industries outperform the bottom half by a factor of 2 to 1 [6]

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Roblox. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. ...

Company Overview - Roblox (RBLX) closed at $46.03, reflecting a -0.58% change from the previous session, underperforming the S&P 500 which lost 0.19% [1] - The stock has increased by 6.78% over the past month, outperforming the Consumer Discretionary sector's gain of 2.68% and the S&P 500's gain of 2.06% [1] Earnings Expectations - The upcoming earnings release is anticipated, with expected EPS of -$0.39, representing a 13.33% increase from the prior-year quarter [2] - Quarterly revenue is projected at $1.02 billion, up 21.19% from the year-ago period [2] - For the fiscal year, earnings are estimated at -$1.59 per share and revenue at $4.22 billion, indicating changes of +14.97% and +19.83% respectively from the prior year [2] Analyst Forecasts - Recent revisions to analyst forecasts for Roblox are important, as they reflect short-term business trends [3] - Upward revisions indicate analysts' positive outlook on the company's operations and profit generation capabilities [3] Zacks Rank System - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a strong track record, with 1 stocks delivering an average annual return of +25% since 1988 [5] - Currently, Roblox holds a Zacks Rank of 3 (Hold), with no changes in the consensus EPS estimate over the past month [5] Industry Context - The Gaming industry, part of the Consumer Discretionary sector, has a Zacks Industry Rank of 140, placing it in the bottom 45% of over 250 industries [6] - The Zacks Industry Rank measures the strength of industry groups based on the average Zacks Rank of individual stocks, with top-rated industries outperforming the bottom half by a factor of 2 to 1 [6]