Indeed, this fusion of a gaming platform with a tool for socializing is what gives Roblox its business moat. The potential of the platform to become a hybrid gaming/social network only then became apparent, a potential reflected in the company’s surging user base and engagement hours. For example, the company isn’t young – it’s been around now for going on 15 years – and many investors might baulk at the idea that the firm is still in its growth phase and yet, for all intents and purposes, it is.īecause it wasn’t until the COVID-induced lock-downs of 2020 – when younger children had limited ways of communicating with their friends outside of their own households – that Roblox really took-off. Its forward P/E ratio is an eye-watering 112.07, and its forward Price/Sales multiple currently stands at 20.67 – a high number when you consider that the sector median is just 1.86.īut Roblox’s story is a more nuanced one than most others, and you have to take into account the firm’s history when attempting a valuation of its business. Is Roblox Stock A Buy?Īt first glance Roblox appears to be an expensively priced company – perhaps even grossly overvalued if you’re being especially pessimistic.

The company generates most of its revenue through micro-payments using its native Robux currency, which users purchase with real money and then use to gain other in-game accouterments such as game passes, avatars, weapon skins and VIP servers. Roblox ( RBLX) is an online gaming platform enabling users to play and create games in a variety of genres using the company’s own proprietary programming engine, the Roblox studio.

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