Shares of Roblox (NYSE:RBLX), a gaming platform, fell by 14.5% last month, according to data provided by S&P Global Market Intelligence, as investors continued to look beyond so-called pandemic plays and after the company's stock received a sell rating from an analyst.
Roblox's stock began falling in mid-July after Benchmark analyst Mike Hickey initiated coverage of the tech company with a price target of $75 and a sell rating on the stock.
After Hickey issued his sell rating some Roblox investors were spooked and pushed the company's share price down about 6%.
Investors have likely also sold Roblox recently because the company was viewed by some as a good investment during the pandemic as more people spent time at home during lockdowns and social distancing.
But as the U.S. economy has opened back up and some events and social gatherings have gone back to relative normal investors have ditched some of their pandemic plays.
Roblox's stock has rebounded slightly in August and is up about 5% this month. Some investors are starting to rethink their strategy of selling off tech stocks because of rising COVID-19 cases, caused by the delta variant, across the U.S.
Roblox will report its second-quarter results on Aug. 16 and with the company still firmly in growth mode, long-term investors may want to ignore some of the recent share price drops and focus more on their initial reasons for investing in this fast-growing gaming platform.