Is Roblox stock a ‘buy’ despite a decline in daily active users?

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Shares of Roblox Corp (NYSE: RBLX) are down 12% on Monday after the video games company reported a sequential decline in its daily active users.

Notable figures in the monthly update

The San Mateo-headquartered firm ended March with 66.2 million DAUs versus 67.3 million in February. On a year-over-year basis, though, the metric still came in up 26%, as per the press release.

Roblox Corp estimated $3.73 to $3.85 of average bookings per daily active user for March. The lower end of that range suggests a 2.0% decline versus last year. Estimated revenue, the company added, climbed as much as 21% to $233 million last month.

Other notable figures in the monthly update include hours engaged that went up 26% and estimated bookings that noted between 23% and 27% increase.

Year-to-date, Roblox stock is still up nearly 45%.

Should you buy Roblox stock?

Reacting to the monthly data, Oppenheimer’s Ari Wald said there’s reason to buy Roblox stock on today’s weakness.

The Head of Technical Analysis sees upside in this name to $44 a share. On CNBC’s “Power Lunch”, he said:

I see a stock that’s been making higher lows since May of last year. It’s stabilised, stopped going down. It moved above its 200-day MA this year. So, with it down 11% today, I think it finds buying interest and snaps back.

Earlier this month, Jefferies also raised its price target on RBLX to $52. Roblox Corp is expected to announce its Q1 financial results in May. Consensus is for it to lose 42 cents a share versus 27 cents per share a year ago.

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