Freedom Capital Markets announced on Thursday that it has raised its rating on Roblox Corp. (NYSE: RBLX) from Hold to Buy but left its price target unchanged at $85.00.
The firm highlighted several drivers behind the upgrade. Roblox is now trading about 37% below the level it did when Freedom Capital Markets began coverage in early December, and the company is trading at roughly 4.40x consensus FY:27 bookings multiple. The stock was trading at $60.57 and has declined nearly 8% over the past week and roughly 55% over the past six months. InvestingPro analysis cited in the research note indicates Roblox is below its Fair Value and that the stock’s Relative Strength Index (RSI) sits in oversold territory.
Central to Freedom Capital Markets’ revised view is what the firm describes as a stronger-than-expected bookings outlook for fiscal year 2026. Management’s guidance points to bookings growth between 22% and 26% for FY:26, a pace the research team said exceeds prior analyst expectations. Management also continues to forecast a growth compound annual growth rate (CAGR) above 20% despite the headwinds of multiple years of outperformance.
In reassessing earlier concerns, the research team acknowledged it had been "too pessimistic" about the potential drag created by age gating on the platform. The firm also characterized broader worries about the potential impact of generative AI on major video game companies as "somewhat misplaced and well overblown."
Freedom Capital Markets underscored platform-level strengths in support of the upgrade. The firm cited the company’s FY:26 guidance, elevated growth across cohort groupings, ongoing technological innovation, and recent operating momentum. The research note pointed to a 35.8% revenue increase over the last twelve months and highlighted a balance sheet with more cash than debt as further evidence of financial resilience.
Analyst price targets for Roblox cited in the research span a broad range from $65 to $180, reflecting differing views about the company’s outlook. Investors and subscribers can access further detail through InvestingPro, which the research note referenced as providing 10 additional ProTips and a comprehensive research report on the company.
Roblox’s most recent quarterly results were also noted in the research commentary. For fourth-quarter 2025, Roblox reported earnings per share of -$0.45, beating the consensus expectation of -$0.47. Revenue for the quarter came in at $2.22 billion, outpacing the forecast of $2.07 billion.
Even with the upside in the quarterly figures, Goldman Sachs adjusted its price target on Roblox from $180 to $140 while retaining a Buy rating. That change followed management commentary emphasizing strong bookings growth and a projection for continued momentum into 2026, though at a slower pace in the second half of the year. Freedom Capital Markets framed these developments as part of Roblox’s ongoing efforts to sustain growth amid market fluctuations.
Overall, the upgrade from Freedom Capital Markets reflects a mix of valuation, near-term bookings strength, platform performance, and balance-sheet robustness. The firm’s decision to keep its $85 target while upgrading the rating signals a recalibrated view that balances optimism on growth with recognition of the stock’s recent pullback.