Last Updated: 16 Sep 2024
Executive Summary
Sea Ltd (SE) is a leading digital entertainment, e-commerce, and digital financial services company in Southeast Asia. The company has a strong track record of growth, driven by its dominant position in its core markets and its ability to expand into new businesses. Sea Ltd's stock has performed well in recent years, but it has underperformed the broader market in 2022. However, the company's long-term prospects remain bright, and it is well-positioned to continue to grow in the years to come.
Company Overview
Sea Ltd was founded in 2009 and is headquartered in Singapore. The company's three core businesses are:
Digital entertainment: Sea Ltd owns and operates Garena, one of the world's leading online gaming platforms. Garena offers a variety of games, including League of Legends, Free Fire, and Call of Duty: Mobile.
E-commerce: Sea Ltd operates Shopee, one of the largest e-commerce platforms in Southeast Asia. Shopee offers a wide range of products, including electronics, fashion, and home goods.
Digital financial services: Sea Ltd operates SeaMoney, a digital financial services platform that offers a variety of services, including mobile payments, lending, and insurance.
Sea Ltd has a strong presence in Southeast Asia, with operations in Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. The company is also expanding into Latin America, with operations in Brazil and Mexico.
Fundamental Analysis
Sea Ltd's financial performance has been strong in recent years. The company's revenue has grown from $1.2 billion in 2017 to $14.5 billion in 2021. Net income has also grown significantly, from $38 million in 2017 to $1.2 billion in 2021.
Sea Ltd's profitability metrics are also strong. The company's gross profit margin has been consistently above 50%, and its operating profit margin has been consistently above 10%. Sea Ltd's return on equity (ROE) is also strong, at over 20%.
Sea Ltd's balance sheet is also strong. The company has a significant amount of cash and equivalents, and its debt-to-equity ratio is low.
Technical Analysis
Sea Ltd's stock price has been volatile in recent years. The stock price reached a high of $372.10 in October 2021, but it has since fallen to $81.18.
The stock price is currently trading below its 50-day and 200-day moving averages. This indicates that the stock is in a downtrend.
The relative strength index (RSI) is currently at 30. This indicates that the stock is oversold.
Short Term Outlook
The short-term outlook for Sea Ltd's stock is uncertain. The stock price is currently in a downtrend, and there are no signs that the trend is reversing. However, the stock is oversold, which could lead to a short-term rally.
Long Term Outlook
The long-term outlook for Sea Ltd's stock is bright. The company is a leader in its core markets, and it is well-positioned to continue to grow in the years to come. The company's strong financial performance and balance sheet also support a positive long-term outlook.
Analyst Recommendations
The majority of analysts have a buy rating on Sea Ltd's stock. The average analyst target price is $88.81.
