Shares of Unity Software Inc. surged 5.60% during Tuesday's intraday trading session, as investor sentiment turned bullish ahead of the company's upcoming second-quarter earnings report.
The sharp rally was fueled by a wave of analyst target price upgrades. UBS raised its target on Unity to $32 from $28 while maintaining a Neutral rating, and Wedbush lifted its target to $36 from $32 with an Outperform rating. The average analyst target price now stands at $36.77, according to FactSet, significantly above recent trading levels, with consensus revenue estimates for Q2 at $515 million, a 20.58% year-over-year increase.
Positive momentum is also being driven by the company's prior quarter beat and strong Q2 guidance, alongside continued progress on its AI-powered advertising platform Vector and the renewal of its virtual reality partnership with Meta. Traders are increasingly positioning for another strong earnings result when Unity reports on August 6.