Unity shares bucking the crowd.

When ALL stocks move the same direction, I don’t think too much about “is the move specific to a company?”.

Today, U Stock price is moving OPPOSITE the crowd.

TMF writer Jon Quast explains.

Why Unity Stock Plunged Today Whereas ironSource Stock Skyrocketed


A merger with Iron Source (IS):
The all-stock deal values ironSource at $4.4 billion. The market capitalization of ironSource was around $2.3 billion prior to the announcement, so Unity is paying a significant premium for the company.

87%. A significant premium indeed!

There will be some Unity share dilution.
But, Jon says “Unity … also announced a $2.5 billion share repurchase program. And two of Unity’s largest shareholders are committing $1 billion each in convertible notes.”

Hmmm. Why would U use the dollars in a buy back, rather than do a cash+stock deal for IS?
Yahoo Finance says U has $1.81B in cash, and $1.82B in debt.

Ie U doesn’t have the $.

I like U for 2 reasons: it’s a strong Gaming platform, and it offers tools that automate coding for App development to gamers and others.

I owned some U, but sold it, as it was a “low conviction”.
Lucky me.


1 Like