Bank of America raised the target price for Roblox stock and extended their bullish ratings on Roblox. They cited the efforts of the company within the Metaverse.
The bullish position, which was taken following the recent BofA Tech Conference, where Roblox CFO gave a presentation, shows a greater appreciation of the company’s growth trajectory and evolving monetization strategy, as well as its continued innovation on their expansive platform.
Bank of America is optimistic about the future
The bank increased the target price from $86 to $103, resulting in a 13% increase on the closing stock of the day before.
Omar Dessouky, a BofA analyst said: “We anticipate that talent and capital will flow faster into the RBLX eco-system than console games & mobile apps for the near future.”
Dessouky stated that the strong performance of the company and its share price have attracted the attention of long-term investors who are interested in growth.
Analyst added that efforts made by the company within the metaverse may be an important growth factor as adoption of its platform grows.
Dessouky stated that “RBLX leads the Metaverse category.”
BofA expects a growth of mid-20% as users adopt Roblox Metaverse. This will lead to a positive cycle which attracts developers, brands and merchants.
Dessouky also said that Roblox does not have to deal with the legacy media companies, which would require resources and effort to make the transition to the metaverse.
The company can spend its entire resources on maintaining the Metaverse leadership, he said.
Dessouky said that rapid productization could lead to consistent growth increases.
Strong quarter aids share price
RBLX has gained more than 54% by 2025.
Roblox’s first-quarter results showed an adjusted earning per share (EPS) of minus $0.32, which was higher than Wall Street expectations.
Revenue for the gaming company increased by 29% compared to last year.
Bookings for the company increased 31% and average users per day increased 26%.
Hours spent on the platform increased 30% as well, showing a strong level of engagement and stickiness.
Roblox has also been successful at diversifying revenue streams.
The company has made significant progress in developing an advertising ecosystem. While Robux transactions remain the core, it is also a major player when it comes to virtual item purchases.
A prime example is the recent partnership between Google and “Rewarded Video Ads”. This new monetization avenue allows brands to engage with users by using immersive ads that are non-disruptive.
Roblox actively works to expand its appeal outside of its younger audience.
The Q1 results for 2025 revealed that users between the ages of 13 and older now account for 64% engagement hours, which is a substantial increase over last year.
This push to expand commercial possibilities is further emphasized by initiatives like Shopify’s collaboration with creators, which allows them to sell merchandise within the platform.
Shareholders approved the move to Delaware.
This move will align the corporate governance of the company with Nevada State rules, and is effective May 30, 2025.
The post Why Bank of America expects Roblox to grow by 13% (RBLX), may change as new information becomes available.
