Morgan Stanley Forecasts Strong Price Appreciation for Unity Software (NYSE:U) Stock

Key Points

• Morgan Stanley has raised its target price for Unity Software stock from $25.00 to $40.00, indicating a potential upside of 21.30% from its previous close.
• Several other analysts have also increased their price targets, with Wedbush setting a target of $41.00 and Needham & Company raising theirs to $40.00.
• Unity Software reported a revenue of $440.94 million during its last quarterly earnings, missing earnings expectations with an EPS of ($0.26).

Unity Software (NYSE:U - Get Free Report) had its target price lifted by equities researchers at Morgan Stanley from $25.00 to $40.00 in a research note issued to investors on Thursday,Benzinga reports. The brokerage presently has an "overweight" rating on the stock. Morgan Stanley's price objective points to a potential upside of 21.30% from the stock's previous close.

A number of other research firms have also commented on U. Wedbush boosted their price target on shares of Unity Software from $39.00 to $41.00 and gave the company an "outperform" rating in a research report on Thursday. Needham & Company LLC lifted their target price on shares of Unity Software from $30.00 to $40.00 and gave the stock a "buy" rating in a research report on Wednesday. Barclays upped their price target on shares of Unity Software from $25.00 to $30.00 and gave the company an "equal weight" rating in a report on Thursday. Wall Street Zen lowered shares of Unity Software from a "buy" rating to a "hold" rating in a report on Friday, June 27th. Finally, Stifel Nicolaus decreased their price objective on Unity Software from $35.00 to $28.00 and set a "buy" rating for the company in a report on Thursday, May 8th. Two research analysts have rated the stock with a sell rating, nine have issued a hold rating, eight have issued a buy rating and two have assigned a strong buy rating to the stock. Based on data from MarketBeat, the company presently has an average rating of "Hold" and a consensus price target of $29.85.

Unity Software Price Performance

Shares of NYSE:U traded up $1.06 during trading on Thursday, hitting $32.98. 10,725,407 shares of the company were exchanged, compared to its average volume of 12,385,856. The company has a quick ratio of 2.74, a current ratio of 2.74 and a debt-to-equity ratio of 0.70. The company has a market capitalization of $13.71 billion, a P/E ratio of -29.29 and a beta of 2.32. Unity Software has a 1-year low of $13.94 and a 1-year high of $38.96. The business's 50 day moving average is $28.16 and its 200-day moving average is $23.85.

Unity Software (NYSE:U - Get Free Report) last issued its quarterly earnings results on Wednesday, August 6th. The company reported ($0.26) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.25) by ($0.01). Unity Software had a negative net margin of 25.21% and a negative return on equity of 14.12%. The business had revenue of $440.94 million during the quarter, compared to analyst estimates of $425.18 million. During the same period last year, the firm posted ($0.32) earnings per share. Unity Software's quarterly revenue was down 1.9% compared to the same quarter last year. Equities analysts forecast that Unity Software will post -1.25 earnings per share for the current year.

Insider Activity at Unity Software

In related news, Director Shlomo Dovrat sold 50,000 shares of the firm's stock in a transaction that occurred on Wednesday, July 9th. The stock was sold at an average price of $30.01, for a total value of $1,500,500.00. Following the sale, the director directly owned 189,089 shares in the company, valued at $5,674,560.89. This trade represents a 20.91% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, CAO Mark Barrysmith sold 1,011 shares of the firm's stock in a transaction that occurred on Wednesday, July 16th. The shares were sold at an average price of $32.30, for a total transaction of $32,655.30. Following the transaction, the chief accounting officer owned 464,372 shares in the company, valued at $14,999,215.60. This represents a 0.22% decrease in their position. The disclosure for this sale can be found here. Over the last three months, insiders sold 1,210,142 shares of company stock valued at $31,199,782. Insiders own 3.61% of the company's stock.

Institutional Trading of Unity Software

Hedge funds and other institutional investors have recently modified their holdings of the company. American Century Companies Inc. acquired a new stake in shares of Unity Software during the 4th quarter worth approximately $318,000. Sei Investments Co. grew its stake in Unity Software by 44.1% during the fourth quarter. Sei Investments Co. now owns 17,922 shares of the company's stock worth $403,000 after buying an additional 5,486 shares during the last quarter. Geode Capital Management LLC raised its stake in shares of Unity Software by 1.8% in the fourth quarter. Geode Capital Management LLC now owns 4,769,609 shares of the company's stock valued at $107,208,000 after acquiring an additional 84,480 shares during the last quarter. Resona Asset Management Co. Ltd. acquired a new stake in Unity Software during the 4th quarter valued at $122,000. Finally, Federated Hermes Inc. raised its position in Unity Software by 557.8% in the 4th quarter. Federated Hermes Inc. now owns 10,617 shares of the company's stock valued at $239,000 after purchasing an additional 9,003 shares during the last quarter. 73.46% of the stock is currently owned by hedge funds and other institutional investors.

About Unity Software

Unity Software Inc operates a real-time 3D development platform. Its platform provides software solutions to create, run, and monetize interactive, real-time 2D and 3D content for mobile phones, tablets, PCs, consoles, and augmented and virtual reality devices. The company offers its solutions directly through its online store and field sales operations in North America, Denmark, Finland, the United Kingdom, Germany, Japan, China, Singapore, and South Korea, as well as indirectly through independent distributors and resellers worldwide.

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