SE - Sea Limited: Solid Growth And Improved Profitability Profile - Better Late Than Never

2024-05-19 09:00:00 ET

Summary

• SE has outperformed the market thus far, thanks to its solid performance across the E-commerce, Finance, and Gaming segments, exceeding expectations.
• The management's reiterated FY2024 guidance has also contributed to the raised consensus forward estimates through FY2026.
• Combined with the healthy balance sheet and minimal near-term risks from GoTo/ TikTok, we believe that SE appears to be reasonably valued compared to its peers.
• The management continues to ramp up Shopee's content ecosystem, while sustaining its live streaming efforts and improving its logistics management, boosting the stickiness/ experience of its consumer base.
• However, this also means that SE's FY2024 positive adj EBITDA margins may potentially be underwhelming. Investors beware.

We previously covered Sea Limited (NYSE: SE ) in March 2024, discussing its impressive FQ4'23 earnings results, which had triggered the stock's immense recovery well exceeding the wider market then....

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