![]() If metaverse is the gold, then the key software that goes into developing the virtual ecosystem is the shovel, and Unity is selling shovels in a gold rush according to Unity, the company "is the world's leading platform for creating and operating interactive, real 3D content." In other words, Unity is one of the market leaders in the distribution of software that is needed to create content in the metaverse digital world. As such, the metaverse trend is most likely impending because driven by demand for further digitalization, the world's biggest companies are investing heavily into the technologies. Using Meta Platforms, previously known as Facebook, for example, changed its company name and announced heavy spending plans to capitalize on the societal change into the coexistence of the physical and the virtual world. The world's most influential technology companies, including Meta ( FB) and Microsoft ( MSFT), have announced their plans to invest in this future. Without a doubt, Unity Technologies is a great company benefiting from a massive underlying societal trend, the metaverse. Reasons Why Unity Is A Great Company Underlying Trend Further, because the metaverse industry will most likely not going to see any fruition shortly, short-term extreme stock price movement does not justify the increase in the company's valuation. The stock may see a correction or a range-bound stagnation until the underlying fundamentals and valuations catch up to the valuation Unity trades at today. Even for a great company with immense potentials, I believe that the valuations will eventually matter. ![]() However, despite Unity being a great company, I am no longer very bullish because I believe paying over $56 billion for Unity today is extremely overvalued. Finally, Unity's financials including the company's net losses are significantly improving. Further, Unity's operational efficiencies are improving even as the market and the company are expanding, and Unity is still implementing growth over profitability strategy. Numerous companies including tech giants today are investing heavily in metaverse creating a beneficial movement for Unity. The company is one of the two leaders in an industry with massive potentials, the metaverse. ![]() Unity, despite my current neutral view, is a great company. However, today, I am updating my views on Unity Technologies because my views on the company changed from very bullish to neutral. At the time of writing, I believed Unity's underlying fundamentals and valuations were too great to ignore. On May 3rd, 2021, I wrote a very bullish article on Unity Technologies ( NYSE: U), and since then, the stock rose about 99.4%. Surasak Suwanmake/iStock via Getty Images Introduction and Thesis
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |