The phenomenon of meme-stock investing shows no signs of slowing down at the start of the new year. Shares of Unity Software (U) continued to surge in trading despite the absence of any significant news about the company, following a cryptic post from Keith Gill, famously known as Roaring Kitty. The company specializes in 3-D content creation for game developers and filmmakers.
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Rally in Unity Software Has a Roaring Kitty Connection?
The rally appears to be linked to a cryptic post from Roaring Kitty, who was the driving force behind the more than 80% surge in meme-stock favorite GameStop (GME) over the past year. The post featured a short clip of Rick James performing his song “Unity.” While the video doesn’t explicitly mention Unity Software, it sparked speculation among retail investors.
Interestingly, the lyrics of another Rick James hit, “Give It to Me Baby,” include the line, “I say, ‘wait til I squeeze you,’” which some investors interpreted as a nod to short-squeeze opportunities.
Unity Software has faced a challenging market environment, with its stock plummeting more than 40% in 2024. Although the company’s Q3 performance exceeded expectations, Unity is grappling with ongoing losses and declining revenues.
Is U Stock a Good Buy?
Analysts remain cautiously optimistic about U stock, with a Moderate Buy consensus rating based on six Buys, five Holds, and two Sells. The average U price target of $24.09 implies an upside potential of 7.2% from current levels.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
