Unity Software (U) PT Raised to $180 at Goldman Sachs

Goldman Sachs analyst Kash Rangan raised the price target on Unity Software (NYSE: U) to $180.00 while maintaining a Buy rating.

The analyst commented, "Unity is down 6% AH despite a solid quarter, as we believe investors were expecting a bigger Create revs acceleration and a larger organic raise to the FY21 guide. However, we note that: 1) Create revs faced a 700bps tougher compare and actually accelerated on a 2-year stack basis to 79% vs 70% in 2Q21, and 2) dollar-based net revenue expansion rates remained steady at 142%, in-line with 2Q, vs 140% in 1Q21, implying the flywheel between Create and Operate remains solid. Furthermore, in our view the proposed acquisition of Weta Digital's tools, pipeline, tech, and engineering talent increases the strategic relevance of Unity across industries, with best-in-class graphic design and visual effect features, and expands its TAM by ~$10bn through a direct funnel to high-value digital artists."

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