Roblox Corporation (NYSE:RBLX) Stocks Pounded By 28% But Not Lagging Industry On Growth Or Pricing
Unfortunately for some shareholders, the Roblox Corporation (NYSE:RBLX) share price has dived 28% in the last thirty days, prolonging recent pain. Longer-term shareholders would now have taken a real hit with the stock declining 5.4% in the last year.
Even after such a large drop in price, given around half the companies in the United States’ Entertainment industry have price-to-sales ratios (or “P/S”) below 1.4x, you may still consider Roblox as a stock to avoid entirely with its 9.2x P/S ratio. However, the P/S might be quite high for a reason and it requires further investigation to determine if it’s justified.
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NYSE:RBLX Price to Sales Ratio vs Industry February 15th 2026
What Does Roblox’s P/S Mean For Shareholders?
Roblox certainly has been doing a good job lately as it’s been growing revenue more than most other companies. It seems that many are expecting the strong revenue performance to persist, which has raised the P/S. If not, then existing shareholders might be a little nervous about the viability of the share price.
Want the full picture on analyst estimates for the company? Then our free report on Roblox will help you uncover what’s on the horizon.
Is There Enough Revenue Growth Forecasted For Roblox?
In order to justify its P/S ratio, Roblox would need to produce outstanding growth that’s well in excess of the industry.
Retrospectively, the last year delivered an exceptional 36% gain to the company’s top line. Pleasingly, revenue has also lifted 120% in aggregate from three years ago, thanks to the last 12 months of growth. Therefore, it’s fair to say the revenue growth recently has been superb for the company.
Turning to the outlook, the next three years should generate growth of 34% each year as estimated by the analysts watching the company. That’s shaping up to be materially higher than the 12% per year growth forecast for the broader industry.
In light of this, it’s understandable that Roblox’s P/S sits above the majority of other companies. It seems most investors are expecting this strong future growth and are willing to pay more for the stock.
The Key Takeaway
Roblox’s shares may have suffered, but its P/S remains high. It’s argued the price-to-sales ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.
We’ve established that Roblox maintains its high P/S on the strength of its forecasted revenue growth being higher than the the rest of the Entertainment industry, as expected. It appears that shareholders are confident in the company’s future revenues, which is propping up the P/S. Unless the analysts have really missed the mark, these strong revenue forecasts should keep the share price buoyant.
And what about other risks? Every company has them, and we’ve spotted 2 warning signs for Roblox you should know about.
If these risks are making you reconsider your opinion on Roblox, explore our interactive list of high quality stocks to get an idea of what else is out there.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
