Roblox enters the week with short sellers retreating and options traders increasingly bullish — a meaningful shift from the bearish consensus that built immediately after the April 30 earnings collapse.
The clearest change this week is in short positioning. After building aggressively through late May, shorts have started to cover. Short interest dropped 5% on June 9 alone, pulling the overall level down to 3.76% of free float from a recent peak near 3.98%. On a week-on-week basis, shorts are down 5%. That said, the one-month picture still shows a 25% net build — so this week's covering represents a partial unwind of the post-earnings pile-in, not a clean reversal. The borrow market reflects the same ease of entry: cost to borrow has fallen roughly 34% on the week to just 0.37%, and availability is extremely loose at over 2,500% of short interest. Any would-be short has near-unlimited room to add. The short score has dipped accordingly, edging down to 35.4 from 36.4 at the start of the week.
Options are telling a more constructive story. The put/call ratio has drifted lower to 0.56, now running nearly 1.6 standard deviations below its 20-day mean of 0.62. That's the least defensive options positioning Roblox has seen in recent weeks, and it sits meaningfully closer to the 52-week low of 0.37 than the 52-week high of 0.93. Calls are clearly in demand. Together with the short covering, the two signals point the same direction this week — something that was explicitly not the case when the previous note flagged bears and options traders moving in opposite directions.
The Street, however, remains a long way from excited. Analyst targets were slashed across the board after the April 30 print — Goldman Sachs halved its target to $65 while keeping Buy; Piper Sandler downgraded to Neutral and cut from $100 to $50; HSBC moved to Hold. The mean target now stands at $64.81, implying roughly 51% upside to the current $43 close, but that gap reflects how far targets fell rather than confidence in a re-rating. The bull case centres on metaverse monetisation and brand partnerships; the bear case is straightforward — age-verification headwinds are pressuring daily active users and bookings, and the financial profile reflects this, with the stock trading on negative earnings and a price-to-book of 36.8x. EPS momentum factor scores rank in the bottom quartile on both 30-day and 90-day windows, at 26 and 22 respectively.
Institutional flows add a layer of nuance. Capital Research added over 7.6 million shares in its most recent filing, making it the largest external holder at 7.4% of shares. Fidelity (FMR) added nearly 1.9 million. Those are meaningful accumulation signals. Offsetting that, insiders are consistently selling — CEO David Baszucki sold twice on June 1 for a combined ~$389,000, and the CFO sold nearly $680,000 of stock on May 20. The 90-day insider net is a positive 157,000 shares, though that likely reflects vesting schedules rather than conviction buying. All insider trades carry a significance score of just 1-2 on a 10-point scale.
Among correlated peers, TTWO fell 4.6% on the week — closely in line with RBLX's 4.4% decline. EA was roughly flat. The parallel with TTWO in particular suggests the week's weakness may reflect broader gaming-sector sentiment rather than anything specific to Roblox.
The next scheduled catalyst is Q2 earnings on July 30. With age-verification implementation still evolving and the DAU trajectory unclear, the question for that print is less about revenue growth and more about whether management can show the 18-plus expansion is generating meaningful engagement — and whether the bookings recovery is real or just noise.
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