This metaverse leader is primed for even more gains going forward, Bank of America says

Bank of America upgraded Roblox's price target to $103 from $86, reiterating a buy rating, citing the company's "structural advantages" and leadership in the metaverse as drivers for growth, with potential for a 13% upside from Wednesday's close. Analyst Omar Dessouky anticipates talent and capital flowing into Roblox's ecosystem faster than mobile app and console games, attracting long-term growth investors. Despite a positive outlook from BofA and a 57% year-to-date surge, the average analyst price target suggests a potential downside of over 18%.

Analysis

Bank of America has upgraded its price target for Roblox (RBLX) to $103 per share from $86, reiterating a buy rating and forecasting approximately 13% upside from Wednesday's close. The bank's analyst, Omar Dessouky, cites Roblox's "structural advantages" and leadership in the metaverse as key growth drivers, anticipating a faster flow of talent and capital into the RBLX ecosystem compared to mobile app and console games. This positive outlook is supported by the expectation of an extended runway for mid-20% growth, fueled by a virtuous cycle of user adoption, developer engagement, and attraction of brands and merchants. Dessouky highlights Roblox's ability to allocate 100% of its resources to maintaining metaverse product leadership, unencumbered by legacy media businesses, which could result in consistent upside to growth estimates. This optimism follows a significant surge in RBLX shares, which have risen over 57% year-to-date in 2025. While most analysts polled by LSEG maintain a buy or strong buy rating on Roblox, it is noteworthy that the average analyst price target implies a potential downside of more than 18% from current levels, presenting a conflicting signal to Bank of America's more bullish stance.

Key Decisions for Investors

• Investors should consider Bank of America's upgraded price target and detailed rationale, focusing on Roblox's perceived leadership in the metaverse and potential for sustained mid-20% growth.
• Given the stock's substantial year-to-date appreciation of over 57%, and the divergence between Bank of America's target and the average analyst price target which suggests over 18% downside, a cautious approach to new positions or additions may be warranted, carefully weighing the high growth expectations against current valuation.
• Monitor key operational metrics such as daily active user growth, developer and creator ecosystem expansion, and platform monetization rates to validate the 'virtuous cycle' thesis and the company's ability to meet ambitious growth projections.