Down 50%, Is Unity Stock a Buy Right Now?


In this video I’ll cover Unity‘s (NYSE:U) first-quarter earnings report and talk about why I continue to be bullish on this company. Yes, the stock is down 50% since its all-time highs but that doesn’t mean the company behind the stock price isn’t doing better. On the contrary, it’s doing much better. 

Earnings highlights

Unity reported revenue of $234.8 million, up 41% year over year. Create Solutions revenue was $70.4 million, up 51%; Operate Solutions revenue was $146.6 million, up 40%; and Strategic Partnerships and Other revenue was $17.8 million, up 12% year over year. Basic and diluted non-GAAP net loss per share was $0.10 versus the consensus estimate of $0.12. Unity expects revenue growth of approximately 30% over the long run and lastly, the company raised full-year guidance by $50 million to $1 billion in revenue. 

Not just gaming

Unity, in my opinion, is the world’s leading platform for creating and operating interactive real-time 3D content. Over half of all mobile, PC, and console games are made with Unity (Pokemon Go, for example). Unity provides an entire design and creation platform so developers can quickly create 3D environments and games.

In the future, many things will be built on Unity, whether it’s next-gen car experiences, real estate, aerospace, or healthcare — with the last one being a big benefactor of this evolution. One of Unity’s clients, VirtaMed, will standardize development for both existing and future products on Unity. It will allow surgeons, physicians, and medical educators to train in risk-free virtual environments and simulations for different diagnostic and therapeutic procedures.

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The future looks bright for Unity. 

Watch the video below for my full insights. 

*Stock prices used were the closing prices of May 11, 2021. The video was published on May 13, 2021.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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