While there might not be a lot of love for turbo-charged growth stocks left on Wall Street, some companies defy the trend, Jim Cramer told his “Mad Money” viewers Monday night. Case in point, Roblox Corporation (RBLX) , the online gaming platform.
After a strong debut via direct listing, shares of Roblox had seemingly stalled, as many investors assumed the game maker had little to offer as our economy reopened. But after another strong quarter, shares shot up Monday, prompting Cramer to reiterate his position.
Roblox has been growing with active users up 37% year-over-year, with no signs of slowing post-pandemic. The company now boasts 43.3 million daily active users, fueled by an ecosystem of developers creating new content on its platform.
Cramer said the company is in a strong position due to its free cash flow increasing 300% and by its expansion plans in China, which are running ahead of schedule.
He remained confident that there is a lot more room to run in Roblox. Let’s check out the charts.
In this daily Japanese candlestick chart of RBLX, below, we can see that prices have improved in recent days. Prices are above the rising 50-day moving average line. The On-Balance-Volume (OBV) line has turned upwards telling us that buyers of RBLX have turned more aggressive. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment.
In this daily Point and Figure chart of RBLX, below, we can see a potential upside price target in the $128 area.
Bottom line strategy: Aggressive traders could go long RBLX on a shallow one or two day dip risking below $73. $100 and then $128 are our price targets.
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