Unity Software Inc. (U) shares are trading higher Thursday after BTIG upgraded the stock from Neutral to Buy and set a price target of $60. The call hinges on a simple thesis: Wall Street is sleeping on Unity's growth potential.
The Bull Case
BTIG's upgrade centers on Unity's Grow segment, which the firm believes is poised to outperform lowball expectations as the broader industry backdrop improves. The analyst sees momentum building into late 2025 that could force upward revisions for 2026 and 2027 estimates.
"Addressing the mobile market backdrop, the benefits of steering … rising non-endemic marketer demand, and UA financing seem underappreciated, and set the stage for double-digit growth in both revenue and UA spend for several more years," BTIG said in the note.
Here's what's particularly interesting: Unity will launch two new data streams in the first half of 2026 tied to runtime and transactional data from its Create in-app purchase rollout. BTIG thinks any revenue from these additions would be incremental to current estimates, meaning there's upside that analysts haven't baked into their models yet.
The Mobile Market Tailwinds
BTIG also pointed to a healthier mobile market environment working in Unity's favor. The firm highlighted several trends: developers shifting transactions away from high-commission app store channels, rising demand from non-endemic marketers, and increased use of user-acquisition financing. Together, these factors should support several years of double-digit growth in both revenue and UA spending.
On the Create side, Unity's new direct transaction framework for developers caught BTIG's attention. The firm believes this could become a meaningful revenue and EBITDA contributor as adoption ramps up. The logic is straightforward: app store commissions are a massive cost for developers, and if competitors' incentives can successfully migrate consumers, Unity's framework could too.
BTIG's math suggests this initiative alone could generate more than $40 million in incremental EBITDA in 2027 and over $100 million in 2028.
"We rate Unity Buy with a $60 PT and a Bull/Bear range of $31-$71 based on 2026 EV/EBITDA," the analyst firm said.
At the time of writing, Unity shares are trading 2.82% higher at $50.36.
