JPMorgan initiates Roblox at overweight rating, says video game stock can rally nearly 20%

JPMorgan initiates Roblox at overweight rating, says video game stock can rally nearly 20%

JPMorgan initiates Roblox at overweight rating, says video game stock can rally nearly 20%

David Baszucki, founder and CEO of Roblox, presents at the Roblox Developer Conference on August 10, 2019 in Burlingame, California.
Ian Tuttle | Getty Images

Video game platform Roblox offers investors a healthy gaming business and an attractive foothold in the potential of the so-called metaverse, JPMorgan said in a note to clients.

Roblox is a company whose main product is video games for children, but the interactive nature of the games and extended playing time makes it a place for kids to socialize virtually. Analyst Alexia Quadrani initiated coverage of the newly public stock with an overweight rating on Tuesday, saying that the market was underestimating both the short-term and long-term potential of the platform.