Market Pulse44Neutral

Unity Software Inc.Opportunity Rank #197(U) Intrinsic Value & DCF Analysis (2026)

Sector: Technology

Current Price

$27.14

Last updated: Jun 23, 2026

Price vs Intrinsic Value

$27.14
Price
$25.07
Intrinsic Value
Overvalued by 8%MOS: $20.06

Fundamental Score

48/100
Bearish

Weighted across 6 signals

Narrative Score

55/100
Improving

-3 vs previous

Trend Score

50/100
Neutral

As of 2026-06-22

The intrinsic value of Unity Software Inc. (U) is estimated at $25.07 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $27.14, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes an 11.27% long-term growth rate and a 10.40% discount rate, reflecting expected future free cash flow and cost of capital.

The intrinsic value of Unity Software Inc. (U) is estimated at $25.07 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $27.14, the stock appears overvalued relative to its projected cash flow fundamentals. This estimate assumes an 11.27% long-term growth rate and a 10.40% discount rate, reflecting expected future free cash flow and cost of capital.

Valuation Details

$25.07
▼ -7.63% downside
20% margin of safety: $20.06
Years: 10Growth Rate: 11.27%
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Capital Efficiency

Average Quarterly ROIC
-3.9%
Cost of Capital (estimated)9%
Value StatusUnderperforming Capital

The company is earning below its required return. This may indicate inefficient use of capital or excess cash that isn't being reinvested.

Complete historical ROIC is available with
.

Fundamental Details

48/100
BearishWeighted across 6 signals
DCF Discount
7.6% premium to price
37
FCF Yield
4.2% trailing FCF yield
55
ROIC vs WACC
ROIC -3.9% vs WACC 9.0% (-0.4x)
0
Net Debt / FCF
0.2x net debt to FCF
96
Buybacks
Share count growing
30
FCF CAGR (5Y)
52.4% 5Y FCF CAGR
100
Strengths: Net Debt / FCF, FCF CAGR (5Y). Concerns: DCF Discount, ROIC vs WACC.

Narrative Details

55/100
Improving
-3 vs previous · +1 new driversVs 6-Month Baseline:Average (48th pct)Weighted across 5 recent drivers
Trend: StableConfidence: 87%Updated: 4h ago
Sources: 50 (34 News · 16 Analyst)
Drivers(last 30 days)
2 regulatory scrutiny+0.3
30 news sentiment+0.2
Earnings miss+0.0
Earnings beat+0.0
16 analyst reiterations0.0

Trend Details

50/100
NeutralAs of 2026-06-22308 daily bars used
3M Relative Strength vs SPY+32.8%
6M Relative Strength vs SPY-48.9%
Distance from 52-Week High-45.1%
Price vs 21 EMA36 · -2.2%
Price vs 50 EMA52 · +0.4%
21 EMA vs 50 EMA70 · +2.6%
3M RS vs SPY100 · +32.8%
6M RS vs SPY0 · -48.9%
Distance from 52W High10 · -45.1%

Investment Coach

Updating... 12d ago
AVOIDConfidence: 54%
Thesis
Unity Software Inc. is currently trading near its fair value with limited upside potential, as returns are trailing the estimated cost of capital. Patience is advised given the neutral fundamentals and weak narrative trend.
Key Risk
The key risk is the company's negative spread between ROIC and WACC, indicating value destruction.
Signals To Watch
  • Price moving to at least a mid-teens discount to fair value.
  • Sustained improvement in ROIC versus WACC spread.
  • Meaningful shifts in the narrative trend and score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 36.79%5 Year CAGR (Adjusted): 255.76%

Free Cash Flow (in millions)

TTM20252024202320222021202020192018
$499$442$358$291-$2-$70$61-$41-$43

How Intrinziq Estimates Fair Value

Intrinziq estimates Unity Software Inc.'s intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

Unity Software Inc.Technology

Unity Software Inc. provides a foundational platform for developing and operating interactive, real-time 3D content. This comprehensive platform offers robust software solutions that empower users to create, deploy, and monetize dynamic 2D and 3D content across a wide array of devices, including mobile phones, tablets, personal computers, gaming consoles, and augmented and virtual reality hardware. The company serves a diverse professional base, assisting content creators, software developers, artists, designers, engineers, and architects in bringing their interactive 2D and 3D visions to life. Unity's offerings are distributed globally through various channels, including its direct online store, dedicated field sales teams, and a network of independent distributors and resellers. This extensive international presence spans numerous countries such as the United States, Canada, China, Japan, Germany, France, the United Kingdom, and many others across Europe, Asia, and South America. Founded in 2004, Unity Software maintains its corporate headquarters in San Francisco, California.