Truist remains optimistic about video games, but reduces Roblox in end-of-quarter update (NYSE: RBLX)

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A quarterly review of interactive / video game names from Truist Securities found that the company was still committed to the group, although some advantage over recent profits brought the names closer to the historical average than the average. S&P 500.

In general, the group of Electronic Arts (EA), Interactive Software Take-TwoNASDAQ:TTWO), Roblox (NYSE:RBLX) and SciPlay (SCPL) surpassed the main market shares by 21-30 points since mid-May, said analyst Matthew Thornton. Twitch viewer growth and mobile app purchases slowed more in May, while Steam viewer growth was steady.

Regarding macro concerns, Thornton said: “We continue to expect the interactive end market to be relatively resilient in a recession (consumer of small tickets as opposed to large consumers or brand advertising), although not immune.

He has ratings for Buy most names, but Truist downgraded Roblox (RBLX) to hold, stating that it is the most unfavorable for the group, referring to revision trends (especially adjusted EBITDA when the company expects long-term aggressive investments); evaluation; exposure to headwind / headwind (it shields highest for variability, lowest for visibility); and return on capital and opportunity for M&A.

The May figures were “weak again”, especially around consumershe noted. He reduced the target price to $ 29 from $ 36, against. Friday closed at $ 26.87.

At the opposite end of Roblox is what he called the most positive outstanding quarter to date: Take-Two (TTWO). Twitch trends, interest in demand and purchases in mobile applications seem relatively positive, led by NBA 2K, while mobile tracking, including Zynga, is approximately equal to Grand Theft Auto is largely followed as expected. The price of Truist is $ 175, which implies a 39% increase.

Thornton also has ratings for Buying Electronic Arts (EA) and SciPlay (SCPL). As for Activision Blizzard (ATVI), received a rating for retention, but there is a strong start for Diablo Immortal as well as looking ahead Overwatch 2 comes in October and Diablo IV in 2023

Wall Street analysts rate Roblox for purchase on average – but the authors of Seeking Alpha have average rating of Holdand Seeking Alpha’s own Quant Ratings approach signal for sale.

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