Morgan Stanley Raises Unity Software (U) Price Target, Keeps Rating

On Friday, May 30, Morgan Stanley raised the price target for Unity Software Inc. (NYSE:U) from $12 to $15 and kept an “Equal-Weight” rating. This change comes after the company reported strong results for its first quarter of 2025. Matthew Cost, the firm’s analyst, gave several reasons for the increased price target.

Morgan Stanley Raises Unity Software (U) Price Target, Keeps Rating

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Morgan Stanley increased its estimates for Unity Software Inc.’s (NYSE:U) performance in 2025 and 2026 after the strong Q1 2025 results. The firm now projects the company’s operating margin to be approximately 20% for the calendar year 2025, which is higher than the previous estimate of around 18%. For calendar year 2026, the firm now projects the operating margin to be approximately 21%, up from the earlier estimate of 18%.

Additionally, Morgan Stanley slightly raised its free cash flow (FCF) estimates for Unity Software Inc. (NYSE:U) and also increased the FCF multiple to 15 times from 14 times.

Unity Software Inc. (NYSE:U) is an American video game software development company that is best known for Unity, a leading game creation engine that helps create video games and other applications. The company offers a suite of tools that help developers create, market, and grow video games and other applications across all major platforms.

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Disclosure: None.