The past few months has seen an explosion of growth in the concept of the metaverse. A digital realm where people can interact with each other, whether socially or for business, the idea is on the forefront for a number of big-name tech companies.
It’s also been a popular idea for retail investors as well, with metaverse-related news for any company enough to cause a jump in shares.
Among the players in the space today, one of the earliest players looks attractive as it’s already proven itself as a model for how to grow a following in the metaverse.
That play? Roblox (RBLX). The platform is primarily use for gamers, and has a strong following with a young demographic, which makes it likely to thrive in the years ahead as other companies get stared from scratch.
Shares of the stock are up about 27 percent in the past year, or about 5 points higher than the S&P 500. While still an early-stage player operating at a loss, revenue soared 102 percent in the past year with no sign of letting up. And the company has over $1.5 billion in net cash on its balance sheet for further expansion.
Action to take: Shares look attractive as a metaverse play, and can likely overcome their short-term weakness and move higher this year.
For traders, the July $100 calls, last going for about $14.10, look like a potential winner in the months ahead. While pricey, they’re near-the-money and could lead to high double-digit returns before expiration.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.