IS - After Another Market Sell-Off Is Unity Software Stock a Buy Yet?
Unity Software (NYSE: U) has been an absolute mess. There's of course the bear market that has sunk Unity's stock over 80% from all-time highs, but that's just the beginning. Earlier this year, the 3D content creation platform was reporting issues with its Unity Monetization segment, the tool video game developers use to earn revenue from their creations. To help accelerate its efforts to right the ship, Unity proposed an acquisition of ironSource (NYSE: IS) . Then, industry peer AppLovin (NASDAQ: APP) tried to tempt Unity shareholders with its own acquisition offer if Unity abandoned the deal with ironSource. Needless to say, it was a whirlwind summer.
The result? Unity stock started to mount a rally, only to be sent back to the basement again. Shares are back near all-time lows as of this writing. Is it time to start buying again?
For the record, though AppLovin was offering Unity shareholders an all-stock deal (worth nearly $59 a share at the time it was announced, a more than 80% premium to where Unity trades as of this writing), I'm not upset that Unity rejected the offer. AppLovin is facing its own slowdown in growth and also has profitability issues it needs to work on. Plus, AppLovin also owns some video game studios. Unity does not, which keeps its interests aligned with the content creators who subscribe to its platform. A Unity-plus-AppLovin tie-up would have decreased Unity's appeal as a trusted non-competing partner for game studios.
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After Another Market Sell-Off, Is Unity Software Stock a Buy Yet?