Sea Ltd’s Strategic Growth and Market Leadership Justify Buy Rating
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Sea operates Southeast Asia's largest e-commerce company, Shopee, in terms of gross merchandise value and number of transactions. Sea started as a gaming business, Garena, but in 2015 expanded into e-commerce, which is now the main growth driver. Shopee is a hybrid C2C and B2C marketplace platform operating in eight core markets. Indonesia accounts for 35% of GMV, with the rest split mainly among Taiwan, Vietnam, Thailand, Malaysia, and the Philippines. For Garena, Free Fire was the most downloaded game in January 2022 and accounted for 74% of gaming revenue in 2021. Sea's third business, SeaMoney, provides lending and we foresee it becoming a larger part of the entire business in the long term as its loan book has grown to $3.5 billion in 2024.
Sea Limited American Depositary Shares Each Representing One Class A Ordinary Share trades on the NYSE stock market under the symbol SE.
As of November 21, 2024, SE stock price climbed to $116.32 with 1,306,313 million shares trading.
SE has a beta of 0.78, meaning it tends to be less sensitive to market movements. SE has a correlation of 0.04 to the broad based SPY ETF.
SE has a market cap of $66.81 billion. This is considered a Large Cap stock.
Last quarter Sea Limited American Depositary Shares Each Representing One Class A Ordinary Share reported $4 billion in Revenue and $.24 earnings per share. This beat revenue expectation by $248 million and missed earnings estimates by -$.02.
In the last 3 years, SE traded as high as $312.83 and as low as $34.35.
The top ETF exchange traded funds that SE belongs to (by Net Assets): IEFA, EFA, EFG, IXUS, EPP.
SE has outperformed the market in the last year with a price return of +202.0% while the SPY ETF gained +31.8%. SE has also outperformed the stock market ETF in the last 3 month and 2 week periods returning +43.5% and +22.0%, respectively, while the SPY returned +6.2% and +0.1%, respectively.
SE support price is $112.01 and resistance is $116.91 (based on 1 day standard deviation move). This means that using the most recent 20 day stock volatility and applying a one standard deviation move around the stock's closing price, stastically there is a 67% probability that SE shares will trade within this expected range on the day.