Bernie McTernan, an analyst from Needham, reiterated the Buy rating on Unity Software. The associated price target was raised to $40.00.
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Forget margin or options. Here's how the pros trade UBernie McTernan has given his Buy rating due to a combination of factors, including Unity Software’s strong performance in the second quarter, which exceeded expectations. The company is strategically positioned within the mobile gaming ecosystem, and McTernan believes they are currently under-earning relative to their potential.
Unity’s Vector initiative is seen as a pivotal step in enhancing their earnings capability, evidenced by a 15% growth in their legacy ad network in the second quarter and anticipated 10% growth in the third quarter. McTernan expects continued gains, projecting a 20% year-over-year growth at Grow next year, with further upside potential from leveraging Create data and expanding Vector to include legacy IronSource. These positive revisions in estimates are likely to significantly impact adjusted EBITDA and free cash flow.
In another report released today, Jefferies also maintained a Buy rating on the stock with a $40.00 price target.