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However, Unity Software Inc. (U) has not been able to capitalize on the industry’s growth. Although the stock has surged 24.9% in price over the past month, the company’s weak financials compared to its peers make it susceptible to a pullback in the near term. In its last reported quarter, U’s net loss increased 442.4% to $148.34 million, and its loss from operations surged 500.5% to $149.18 million, demonstrating weak fundamentals. In addition, the stock has declined 21.3% year-to-date.
Therefore, we think it could be wise to bet instead on shares of fundamentally sound companies in this space Electronic Arts Inc . (NASDAQ:EA), Playtika Holding Corp. (PLTK), and Ubisoft Entertainment (UBSFY). These three stocks are better positioned than U to cash in on the growing demand for video games.
