Beware of Selling Pressure on Roblox, CoreWeave, and The Trade Desk
The gaming sector has obvious winners that include Electronic Arts (EA) and Take-Two Interactive (TTWO). Roblox (RBLX), whose stock peaked at $150.59, is a less obvious choice. Shares more than doubled their price from the $50 low in April to close at $117.34.
Last Friday, RBLX stock lost 6.34% on multiple reports that the platform did not protect child-aged gamers against child predators. NBC News reported that the attorney general in Louisiana filed a suit. It accused the firm of lacking strong safety protocols. RBLX stock has a short interest of 2.81%. Few bears are betting against the gaming platform.
CoreWeave (CRWV) recently rallied to around $150 only to slump. It closed at $99.97 on Aug. 15. The lockup period ended last week. The chances are high that insiders will file sales in the AI hyperscaler firm. Already, Jack Cogen, a director, has sold around $300 million worth of shares. Investors should consider Nebius Group (NBIS) instead for better relative value.
Shorts circulated a rumor that The Trade Desk (TTD) lost Walmart’s (WMT) business. TTD posted a press release to refute the claim. Still, the $60-$80 uptrend this summer is over. TTD stock closed at $52.12 on Aug. 15. Selling pressure will continue, since TTD cannot publicize too many details on the Walmart advertising strategy. That would help competitors like Costco (COST) and Target (TGT). As a result, it could push the share price below $50.
