Stockchase Opinions

Jim Cramer - Mad Money Unity Software U-N DON'T BUY Jun 14, 2024

It's a falling knife.

$16.400

Stock price when the opinion was issued

Technology
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COMMENT
A favourite of his and former high flyer. They just reported an in-line quarter but cut full-year guidance. The stock plunged today. Why? They were hit by Apple's privacy restrictions on targeted advertising. So they developed their ad-tracking technology of users, but there was a serious engineering error that is since fixed, says management. A great company, but shares have fallen 85% from the peak. It won't turn a profit until 2026, though.
DON'T BUY
Unity doesn't make money, unlike Meta or Microsoft in tech. Unity is too speculative.
DON'T BUY
From Nvidia's pre-announcement today we know that videogames are weak. Unity reports tomorrow. Unity may get beaten down even more.
PAST TOP PICK
(A Top Pick Dec 29/21, Down 81%) He got out in February, when all the levered SaaS companies got hit. These companies have so much debt because they spend so much money getting talent. Fantastic company. Software is used to make more than 50% of the world's gaming. Company expects to break even in Q4. Wait until Fed pivots to buy.
BUY

A good CEO. Are creating proprietary software.

BUY ON WEAKNESS

Right now, a bit rich. You can see the spike on the chart, due to recent partnership with AAPL. Came down from grace quite a bit, but has recovered from lows in the $20s. Fairly well priced. He'd look to buy on either side of $30.

DON'T BUY

It's had so many problems, and he can't recommend it until it makes money.

DON'T BUY

Sideways trading range. Big fall on the chart indicates the 4-year reset. Chart doesn't look good, suggests nothing positive. Don't add exposure.

BUY ON WEAKNESS

He did own it, but not recently. It could turn around in 2025. Could be a hold or buy on pullback. Be cautious on entry, though. It's fairly priced now. Buy around $20.50, then $19.