Roblox assumed with Hold from Buy at Jefferies

Jefferies downgraded Roblox to Hold from Buy with a price target of $42, down from $51, after assuming coverage of the name. The stock’s “premium valuation warrants caution,” the analyst tells investors in a research note. The firm likes Roblox’s position as the leading platform in user-generated content for the 8-13 year old demo. However, growth and margin expectations are “lofty,” with the company and investors already looking for a return to 20%-plus bookings growth from fiscal 2025 through 2027, contends Jefferies. It believes the company’s execution “has been concerning recently” with the company missing sales expectations two of the last four quarters.