Roblox (SYM: RBLX) plummeted from about $48 to a recent low of $37.50.
All after a short report from Hindenburg Research crushed the stock on allegations of inflated key metrics and that it’s not safe for kids.
All of which RBLX denied.
“We totally reject the claims made in the report,” Roblox said in a statement. “The financial claims made by Hindenburg Research are simply misleading. The authors are admittedly short sellers and have an agenda irrespective of the substance of Roblox’ business model and results. The focus on cash bookings and cash flow are themes that we have focused on consistently with investors dating back to our days as a private company.”
“The author made no attempt to highlight any of that because the positive facts simply don’t support their agenda. We firmly believe Roblox is a safe and secure platform and in the financial metrics we report,” Roblox said.
We also have to consider that RBLX is still seeing solid momentum in user engagement and bookings. Plus, it’s still technically oversold following the short report, which is well worth taking advantage of moving forward.
