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Truist analyst Matthew Thornton cut rating on Roblox Corp (NYSE:RBLX) shares to Hold from Buy after weak May metrics.
The analyst has a $29.00 per share price target on Roblox shares.
Thornton names 4 key reasons behind the downgrade.
Moreover, the analyst sees a major headwind in rising competition, especially from the new Epic-Lego partnership.
“The former’s expertise in the engine/creator tools (Unreal Engine) and large-scale experiences (Fortnite) and the latter’s brand and overlap with RBLX’s core demo,” Thornton told clients in a note.
Furthermore, “the progress around other platforms, for example Meta’s (NASDAQ:META) given that company’s resources, could be a headwind for RBLX (from a newsflow perspective at a minimum).”
Roblox shares are up almost 1% in pre-market Friday.
