Looking at RBLX right now, I can't ignore how brutal this past year has been for the stock. It peaked near 130 back in September and has been on a pretty relentless slide ever since. Sitting at 48.16 today does feel like a big reset. There's a temptation to call a bottom, but honestly? I'm not convinced we're out of the woods yet.
My stance is bearish in the near term. The drop from 130 to 45 is massive and while some might see value here, I'm concerned about user growth stalling out and spending per user not really keeping pace. The company has yet to prove it can consistently monetize its heavy user base, and that story hasn't changed much even as they've pushed new updates and partnerships. Competition in online gaming is only getting tougher and it's not clear that RBLX has some kind of moat protecting it from the next hit platform.
The risk here is that the selloff has already priced in a lot of negativity. If they can show any real acceleration in bookings or engagement in the next quarter, the stock could bounce hard. I just don't see a clear catalyst until the next earnings, and if those numbers disappoint (or even just come in flat), there could be another leg down. So I'm setting a target price of 40.00 for the next 6 weeks. That's not a huge drop but it reflects my expectation for more volatility and possible disappointment before any turnaround story can take hold.
If RBLX manages to surprise with a user retention uptick or some unexpected licensing deal in the summer, I'll have to re evaluate, but right now I think caution is warranted.
