Bank of America extended its bullish rating on Roblox (RBLX) and raised its target price on the stock, citing the company’s efforts within the metaverse.
This bullish stance, following a recent BofA Tech Conference where Roblox’s CFO presented, reflects a deeper appreciation for the company’s sustained growth trajectory, evolving monetization strategies, and continued innovation within its expansive platform.
What drives Bank of America’s optimism
The bank maintained its “buy” rating and increased its target price to $103 from $86, indicating a 13% upside on the stock from the previous day’s close.
BofA analyst Omar Dessouky said, “We expect to see talent and capital flow into the RBLX ecosystem faster than mobile app & console games for the foreseeable future.”
Dessouky said the company’s strong results and the share price rally have piqued interest among long-term growth-oriented investors.
The analyst added that the company’s efforts within the metaverse could be a significant growth driver as the adoption of the company’s platform increases.
“RBLX is the ‘Metaverse’ category leader,” Dessouky said.
BofA sees an extended runway for a mid-20 % growth as more users increasingly adopt Roblox’s Metaverse, which will create a virtuous cycle that will attract developers, merchants and brands to the site.
According to Dessouky, Roblox is also not burdened with legacy media businesses that would need resources and efforts to transition towards the metaverse.
He added that the company could spend all its resources towards maintaining its Metaverse product leadership.
“Rapid productization of innovations could result in consistent upside to growth estimates,” Dessouky noted.
Strong quarter aids share price
RBLX shares have gained over 54% in 2025.
Roblox, in its first quarter results, posted an adjusted earnings per share of -$0.32, which exceeded Wall Street’s expectations.
The gaming company saw its revenue surge by 29% from the previous year.
Its bookings increased by 31%, and the average daily active users increased by 26%.
The hours engaged on the platform also increased by 30%, demonstrating strong user stickiness and immersion.
Roblox is also successful in diversifying its revenue streams.
While Robux transactions for virtual items remain central, the company is making significant strides in building out an advertising ecosystem.
The recent partnership with Google for “Rewarded Video Ads” is a prime example, offering a new avenue for monetization by allowing brands to engage users through immersive, non-disruptive ads.
Furthermore, Roblox is actively working to broaden its appeal beyond its traditional younger demographic.
Q1 2025 results revealed that 64% of engagement hours now come from users aged 13 and up, a significant increase from the previous year.
Initiatives like allowing creators to sell physical merchandise directly within the platform, in collaboration with Shopify, further emphasize this push for broader commercial opportunities.
The company also completed reincorporation to Delaware from Nevada, a move which was approved by the company’s shareholders in its annual meeting.
The move, effective as of May 30, 2025, aligns the company’s corporate governance with Nevada state rules.
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