Crisis may lead to opportunity for Roblox (RBLX).

After gapping lower on earnings, the stock has become over-extended on RSI, MACD, and Williams’ %R. Plus, it appears most of the earnings negativity has been priced into the stock. Helping, Morgan Stanley just raised its rating on RBLX to equal weight from underweight, with a $30 price target. The firm noted the current price now fairly reflects near-term headwinds, as noted by Seeking Alpha. Wedbush Securities also upgraded RBLX to an outperform rating.

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“On balance, Roblox may have the most compelling growth trajectory among the video game names in our coverage universe after taking into account its user base size, its new products, and the potential to revisit its approach to profits,” Wedbush added. “With Roblox shares trading well below our price target after a selloff on Wednesday, the risk/reward profile has become favorable to the upside.”

Sincerely,

Ian Cooper