Roblox Soars 2.63% as Wedbush Price Target Hikes Spark Frenzy—Is This a Game-Changing Rally or a Bubble?

Summary
• Wedbush analyst Michael Pachter raises RBLX price target to $142 from $110
• Roblox hits 52-week high of $121.79 amid record user numbers
• Options frenzy surges with 20+ contracts trading above 10,000 shares

Roblox Corporation (RBLX) is trading at a blistering pace as the stock surges 2.63% to $121.23, breaking through key resistance levels. With Wedbush’s bullish upgrade, record user metrics, and a surging options market, the stock’s 2025 trajectory has ignited a firestorm of speculation. This 2.63% rally—driven by a mix of institutional buying, analyst upgrades, and viral product momentum—has pushed RBLX within 5% of its 52-week high of $127.99, raising urgent questions about sustainability.

Wedbush’s Bullish Outlook Ignites RBLX Surge
The 2.63% intraday rally in Roblox is a direct response to Wedbush’s upgraded price target to $142 from $110, driven by the firm’s conviction in Roblox’s user growth and monetization potential. Recent earnings highlighted record concurrent player numbers, fueled by viral games like 'Grow a Garden,' while new monetization tools like rewarded video ads with Google are unlocking previously untapped revenue streams. Analysts emphasize that Roblox’s ability to monetize 80% of unmonetized user time represents a $10B+ opportunity, with Wedbush projecting 20% annual growth. This narrative has triggered a buying frenzy among institutional investors, including Victory Capital Management and SBI Securities, who’ve increased holdings by 2.5%–74.8% in Q1 2025.

Options Frenzy and ETFs Signal High-Conviction Bullish Play
• MACD: 6.63 (bullish divergence from signal line 6.44)
• RSI: 70.05 (overbought territory)
• Bollinger Bands: Price at 121.23 (near upper band 127.18)
• 200D MA: 68.21 (price 83% above)
• Gamma/Theta: Contracts with gamma ≥0.018 and theta ≥-0.82 show high sensitivity

Roblox’s technicals scream high-conviction bullish momentum. The stock is trading above all major moving averages, with RSI near overbought levels and MACD in a positive divergence. The Bollinger Bands suggest a potential pullback to the middle band at 111.20, but institutional buying and Wedbush’s $142 target imply a strong bias toward the upper band. The ROBO Global AI ETF (THNQ), up 0.61%, offers leveraged exposure to AI-driven tech names, including RBLX, making it a strategic satellite play.

Top Options:
• RBLX20250801C114
- Call option, strike $114, expires 2025-08-01
- IV: 116.10% (high volatility)
- Delta: 0.67 (moderate sensitivity)
- Theta: -0.85 (rapid time decay)
- Gamma: 0.017 (responsive to price swings)
- Turnover: 25,830 (high liquidity)
- Leverage: 9.86% (moderate gearing)
- Payoff: If RBLX hits $121.23 + 5% ($127.30), payoff = $127.30 - $114 = $13.30 per contract
- Why it stands out: High liquidity and gamma make this ideal for a 5–7% move in the next 7 days.

• RBLX20250801C120
- Call option, strike $120, expires 2025-08-01
- IV: 113.25% (high volatility)
- Delta: 0.56 (moderate sensitivity)
- Theta: -0.83 (rapid time decay)
- Gamma: 0.019 (high responsiveness)
- Turnover: 124,764 (extremely liquid)
- Leverage: 13.80% (strong gearing)
- Payoff: At $127.30, payoff = $127.30 - $120 = $7.30 per contract
- Why it stands out: High turnover and leverage make this a top-tier play for a $125–$130 move.

Action: Aggressive bulls should buy RBLX20250801C120 into a breakout above $124.50. Conservative traders can use THNQ for leveraged exposure while hedging with the RBLX20250801P114 put option.

Backtest Roblox Stock Performance
The backtest of Roblox's (RBLX) performance following a 3% intraday increase shows promising results. The strategy achieved a 64.76% return, significantly outperforming the benchmark return of 54.92%. With a maximum drawdown of 0.00% and a Sharpe ratio of 0.17, the strategy demonstrated robust risk management and profitability.

Roblox’s Rally Faces Crucial Test—Here’s What to Watch Next
Roblox’s 2.63% surge is a high-stakes inflection point. While Wedbush’s $142 target and viral user growth justify optimism, the stock’s -95.59x P/E and overbought RSI signal caution. The key levels to watch are $124.50 (Bollinger upper band) and $116.50 (20D MA). If RBLX breaks $124.50, the RBLX20250801C120 call option could deliver 15%+ gains in a week. Conversely, a breakdown below $116.50 would validate bearish sentiment. Meanwhile, the sector leader Microsoft (MSFT) is up 0.26%, offering a broader tech market benchmark. Act now: Buy RBLX20250801C120 into a breakout above $124.50 or short RBLX20250801P114 if the 20D MA breaks.