Things aren't looking so good for Roblox , Atlantic Equities said. Analyst Kunaal Malde downgraded shares of Roblox to neutral, saying in a Tuesday note that flagging user engagement numbers suggest trouble ahead as the company tries to monetize its online gaming platform. "We believe Roblox is taking the right approach to increase focus on monetisation and YoY bookings trends should improve going forward as comps get easier," Malde said. "However, weakening app download trends suggest engagement could continue to soften in core markets in the near-term." Atlantic Equities also slashed its price target in half to $30 per share from $60. The new price target is in line with Monday's closing price for the company. The valuation is also "less attractive," according to the brokerage firm. Shares of Roblox may be down 70% year to date but the analyst noted that its competitors have done similarly. "[E]ven though the stock has performed poorly year-to-date, so have peers. As such, the stock's growth-adjusted valuation looks less attractive than others in our coverage on a relative basis," Malde wrote. Shares of Roblox dropped 4% in Tuesday premarket trading. —CNBC's Michael Bloom contributed to this report.