2023-04-18 11:36:34 ET
The pandemic and its effects on the economy over the past three years have had a volatile effect on Sea Limited 's (NYSE: SE) three business segments: Garena is its internet gaming business; Shopee is its e-commerce operation; and SeaMoney is its fintech application. It results in accelerated growth as well as sharp pullbacks. Moreover, general market sentiment toward all early-stage, high-growth, and unprofitable companies (the exact characteristics of Sea Limited) turned decidedly negative last year. As a result, the stock had a horrendous 2022.
2023 has been a different story for the stock, and it started the year with a bang, rising 60.52% year to date. Why has sentiment on the stock shifted so rapidly? And should investors take it as a sign to get on the bandwagon and invest as well? Let's discuss this.
Many growth investors fell in full-bloom love with this company back in 2018 when Sea Limited began putting up quarter after quarter of triple-digit, year-over-year revenue growth -- a trend that only ended in early 2022 when revenue growth apparently fell off a cliff. It was around then that market sentiment turned sour and the stock price dropped 77% during the year.
For further details see:
After Sea Limited's Huge Stock-Price Run-Up, Is It Still A Buy?