Unity Software (NYSE:U) Trading 4.8% Higher After Analyst Upgrade

Key Points

• Shares rose 4.8% after Morgan Stanley raised its price target from $30 to $32 and maintained an "overweight" rating; the stock traded up to $20.74 and was last at $20.38 on below-average volume.
• Street sentiment is a Moderate Buy with a consensus price target of $37.41, reflecting more Buy ratings than Holds or Sells.
• Unity beat Q4 estimates with $0.24 EPS (vs. $0.20 expected) and $503.09M revenue (up 10.1% YoY), but the company remains unprofitable with a negative net margin (-21.77%) and negative ROE.

Unity Software Inc. (NYSE:U - Get Free Report)'s stock price shot up 4.8% during trading on Monday after Morgan Stanley raised their price target on the stock from $30.00 to $32.00. Morgan Stanley currently has an overweight rating on the stock. Unity Software traded as high as $20.74 and last traded at $20.38. 5,083,240 shares were traded during mid-day trading, a decline of 72% from the average session volume of 17,888,748 shares. The stock had previously closed at $19.45.

Several other equities research analysts have also issued reports on the company. Freedom Capital raised Unity Software to a "strong-buy" rating in a research note on Thursday, January 15th. Bank of America boosted their target price on Unity Software from $19.00 to $21.00 and gave the company a "neutral" rating in a research report on Friday. Jefferies Financial Group increased their price target on Unity Software from $49.00 to $55.00 and gave the company a "buy" rating in a report on Monday, January 5th. Citigroup lowered their price target on Unity Software from $52.00 to $43.00 and set a "buy" rating for the company in a research report on Thursday, February 12th. Finally, Wedbush reaffirmed an "outperform" rating and set a $30.00 price objective on shares of Unity Software in a research note on Friday. One analyst has rated the stock with a Strong Buy rating, thirteen have issued a Buy rating, eight have issued a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat, the company presently has an average rating of "Moderate Buy" and a consensus price target of $37.41.

Insiders Place Their Bets

In related news, COO Alexander Blum sold 10,164 shares of the business's stock in a transaction that occurred on Wednesday, February 25th. The stock was sold at an average price of $18.07, for a total value of $183,663.48. Following the completion of the sale, the chief operating officer owned 550,966 shares in the company, valued at approximately $9,955,955.62. The trade was a 1.81% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CAO Mark Barrysmith sold 10,578 shares of the business's stock in a transaction that occurred on Wednesday, February 25th. The shares were sold at an average price of $18.07, for a total value of $191,144.46. Following the completion of the sale, the chief accounting officer owned 383,901 shares of the company's stock, valued at $6,937,091.07. The trade was a 2.68% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 41,684 shares of company stock worth $773,350 in the last three months. Corporate insiders own 3.61% of the company's stock.

Institutional Investors Weigh In On Unity Software

Several hedge funds have recently made changes to their positions in U. Purpose Unlimited Inc. purchased a new position in shares of Unity Software during the fourth quarter valued at $230,000. Corient Private Wealth LLC grew its holdings in Unity Software by 63.2% during the 4th quarter. Corient Private Wealth LLC now owns 17,681 shares of the company's stock worth $781,000 after acquiring an additional 6,845 shares in the last quarter. Bank of Hawaii bought a new position in Unity Software during the 4th quarter worth about $872,000. T. Rowe Price Investment Management Inc. increased its position in Unity Software by 41.5% during the 4th quarter. T. Rowe Price Investment Management Inc. now owns 4,622,445 shares of the company's stock valued at $204,174,000 after purchasing an additional 1,355,847 shares during the period. Finally, Compound Planning Inc. raised its holdings in shares of Unity Software by 35.6% in the 4th quarter. Compound Planning Inc. now owns 12,764 shares of the company's stock valued at $564,000 after purchasing an additional 3,354 shares in the last quarter. 73.46% of the stock is currently owned by hedge funds and other institutional investors.

Unity Software Stock Performance

The firm has a market cap of $8.84 billion, a P/E ratio of -21.34, a price-to-earnings-growth ratio of 10.43 and a beta of 2.14. The firm's fifty day moving average price is $24.34 and its 200 day moving average price is $35.69. The company has a debt-to-equity ratio of 0.52, a quick ratio of 1.84 and a current ratio of 1.84.

Unity Software (NYSE:U - Get Free Report) last announced its earnings results on Wednesday, February 11th. The company reported $0.24 EPS for the quarter, topping analysts' consensus estimates of $0.20 by $0.04. Unity Software had a negative net margin of 21.77% and a negative return on equity of 4.76%. The business had revenue of $503.09 million during the quarter, compared to the consensus estimate of $490.64 million. During the same period in the previous year, the company posted ($0.30) earnings per share. The firm's revenue was up 10.1% on a year-over-year basis. Sell-side analysts expect that Unity Software Inc. will post -1.25 EPS for the current fiscal year.

About Unity Software

Unity Software is a leading provider of a real-time 3D development platform that enables creators across industries to design, build and operate interactive, real-time experiences. Originally focused on the game development market, Unity's technology now extends into sectors such as film, automotive, architecture, engineering and construction, delivering immersive content for mobile, desktop, console, augmented reality and virtual reality devices. The company's core offering comprises a suite of authoring tools, runtime engines and cloud services that streamline the creation and deployment of interactive 3D applications.

The Unity Editor serves as the central hub where developers design scenes, script behavior and iterate on assets.

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