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Roblox Set to Go Public With Direct Listing of 199 Million Shares

New York Stock Exchange sets reference price of $45.
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Roblox, an online game platform and creation system that’s popular with the Reddit crowd, is scheduled to go public Wednesday with a direct listing of 199 million shares.

It will trade on the New York Stock Exchange under the ticker symbol " (RBLX) - Get Roblox Corp. Class A Report." The exchange set a reference price of $45 after the market closed Tuesday. Roblox isn’t raising fresh capital.

In terms of the platform, it allows users to program games and play games created by other users. It’s popular with kids.

As for the Reddit enthusiasm, “I think I might have a smooth enough brain to jump in on this,” doormat wrote in the chat room. “Kids distance learning always got tabs open in Roblox and know where mommy leaves her purse.” To be sure, some Reddit users expressed bearishness too.

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A poll of investors by research firm Bernstein finds they believe the stock could trade anywhere from $30 to $120 when it hits the open market, Bloomberg reported. That could mean heavy volatility, said Bernstein analyst Todd Juenger.

“Most professional investors believe there will be heavy retail interest in this name, without much price constraint,” he wrote.

In its S-1 initial public offering prospectus, Roblox reported that daily active users soared 82% to 31.1 million in the nine months ended Sept. 30, 2020, from 17.1 million a year earlier.

Revenue jumped 68% to $588.7 million from $349.9 million. The company registered a loss of $203.2 million in the latest nine-month period, widening from $46.3 million a year earlier.

Free cash flow totaled $292.6 million in the latest period, up from $6.0 million a year ago.