Roblox: This Massive Rally Is Unsustainable

Jul. 29, 2022 9:30 AM ETRoblox Corporation (RBLX)5 Comments


  • Roblox has staged a remarkable recovery since its May lows, as the market dissected the bearish thesis, given its oversold bottom.
  • We believe the market had already anticipated its near-term headwinds, which sent RBLX crashing to its May lows. Therefore, a short-term rally was expected.
  • However, we believe the magnitude of the rally is unsustainable. As a result, Roblox may not sustain its high-growth momentum moving forward at its current valuation.
  • Therefore, we believe that investors who picked the May bottom to add should consider cutting exposure and rotating some of those gains away.
  • We revise our rating from Hold to Sell.
  • I do much more than just articles at Ultimate Growth Investing: Members get access to model portfolios, regular updates, a chat room, and more. Learn More »

Roblox Developer Conference 2019

Ian Tuttle


Roblox Corporation (NYSE:RBLX) stock has seen a remarkable recovery as it also rode the positive wave from retail traders on the WallStreetBets forum in early July. Notably, RBLX rallied nearly 100% from its May lows, demolishing any bearish thesis

Roblox revenue change % and adjusted EBITDA change % consensus estimates

Roblox revenue change % and adjusted EBITDA change % consensus estimates (S&P Cap IQ)

Roblox revenue change % and adjusted EBITDA change % consensus estimates (By FY)

Roblox revenue change % and adjusted EBITDA change % consensus estimates (By FY) (S&P Cap IQ)

Do you want to buy only at the right entry points for your growth stocks?

We help you to pick lower-risk entry points, ensuring you are able to capitalize on them with a higher probability of success and profit on their next wave up. Your membership also includes:

  • 24/7 access to our model portfolios

  • Daily Tactical Market Analysis to sharpen your market awareness and avoid the emotional rollercoaster

  • Access to all our top stocks and earnings ideas

  • Access to all our charts with specific entry points

  • Real-time chatroom support

  • Real-time buy/sell/hedge alerts

Sign up now for a Risk-Free 14-Day free trial!

This article was written by

JR Research profile picture
Sifting through the ultimate growth stocks for your portfolio

JR research was featured as one of Seeking Alpha's leading contributors in 2022. See:

Unlock the key insights to growth investing with JR Research - led by founder and lead writer JR. Our dedicated team is focused on providing you with the clarity you need to make confident investment decisions.

Transform your investment strategy with our popular Investing Groups service. 

Ultimate Growth Investing specializes in a price action-based approach to uncovering the opportunities in growth and technology stocks, backed by actionable fundamental analysis. We believe price action is a leading indicator. 

Price action analysis is a powerful and versatile toolkit for the informed investor because it can be used to analyze any publicly traded security. As such, it offers investors with invaluable insights into understanding market behavior and sentiments. 

Plus, stay ahead of the game with our general stock analysis across a wide range of sectors and industries. 

Improve your returns and stay ahead of the curve with our short- to medium-term stock analysis. 

We not only identify long-term potential but also seize opportunities to profit from short-term market swings, using a combination of long and short set-ups. 

Join us and start seeing experiencing the quality of our service today.

My LinkedIn:

Disclosure: I/we have a beneficial long position in the shares of RBLX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Recommended For You

Comments (5)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.