Roblox Stock Jumps Pre-Market On Morgan Stanley Upgrade: Retail Investors Feel Bullish

Roblox ($RBLX) shares rose as much as 4% before markets opened on Wednesday following an upgrade from Morgan Stanley. 

The stock has been rallying for the last five trading sessions with gains of 24% in the last week. If pre-market gains hold, the stock may reach another 52-week high, having already hit a two-year peak of $52.65 on Friday.

Morgan Stanley upgraded the stock to 'Overweight' from 'Equal Weight' and raised its price target to $65 from $38, citing the potential for Roblox's user-generated content to drive accelerated growth and capture a broader audience across platforms. 

The brokerage’s note mentioned that “the opportunity is only growing,” reinforcing confidence in the company's future trajectory as it reaches an “inflection point.”

Following Roblox’s third-quarter earnings on Oct. 31, other analysts echoed similar optimism. 

Wedbush upgraded its price target to $67.50 from $49 and maintained an ‘Outperform’ rating. It described Roblox as “rising like a phoenix” highlighting that an increasing number of brands are keenly interested in engaging with the platform’s users. 

JPMorgan increased its price target to $62 from $51 with an ‘Overweight’ rating citing conversations with the company that suggest that bookings trends “remain healthy.”

Retail sentiment on Stocktwits was ‘bullish’ (57/100) at market closing on Friday, with ‘high’ message volume.

Allegations from Hindenburg Research calling Roblox an “x-rated pedophile hellscape,” still loom over the company. On Friday, the short-seller shared a post on X (formerly Twitter), which revealed a Roblox chat related to child sexual exploitation.

Roblox has not yet responded to the allegations in the video.

Roblox's stock has surged 25% in 2024, with most of that increase — 24% — occurring in the past week.

For updates and corrections email newsroom@stocktwits.com.

Read more: Roblox Stock Hits 2-Year High After Q3 Bookings Beat: Retail Cheer Grows On Raised Guidance