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Sea Limited - AI Stock Analysis

Analysis generated March 17, 2025

Sea Limited is a leading internet service provider in Southeast Asia and Taiwan. The company operates through three main segments: digital entertainment, e-commerce, and digital financial services. With its flagship platforms like Garena (gaming), Shopee (e-commerce), and SeaMoney (payments and financial services), Sea Limited has garnered a strong foothold in its target markets.

The diverse portfolio allows Sea Limited to capitalize on multiple revenue streams and adapt to changing market dynamics, making it a noteworthy player in the region's internet economy. Over recent years, the company has shown promising growth trajectories in all its operational verticals.

Fundamental Analysis

Sea Limited's revenue for the last quarter stood at $4.33 billion, marking an impressive increase of 13.99% compared to the preceding quarter. Even more compelling is the year-over-year growth rate of 30.76%, which showcases the company's robust expansion over the last year.

Net income also presents a strong picture, coming in at $153 million for the last quarter. This figure reflects an increase of 87.77% from the prior quarter and a substantial year-over-year growth of 206.49%, suggesting a solid improvement in profitability.

It's worth noting that EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) saw a quarter-on-quarter decrease of 18.31% to $202 million, which might be a red flag. However, the year-over-year increase of 1,080.03% indicates long-term growth and improved operational efficiency.

The current P/E (Price to Earnings) ratio stands at 172.2, significantly elevated, which could signal an overvalued stock. A high P/E ratio typically implies high investor expectations for future growth, but it can also mean that the stock price is inflated relative to earnings.

Technical Analysis

Today's stock price for Sea Limited is $132.64, reflecting a decrease of 1.71% compared to a month ago. This can be a concern for short-term investors. However, the one-year increase of 129.28% indicates a strong long-term positive trend.

The stock's current Simple Moving Average (SMA10) is 129.58, down from the previous SMA10 of 129.88. This suggests a potential downward trend in the short term. Moreover, the Relative Strength Index (RSI) is at 16.9, an indicator of an oversold condition, which could present a buying opportunity for investors looking at a potential rebound.

Alternative Data Analysis

Examining job postings and employee sentiment, Sea Limited has seen a 17% increase in open positions, now totaling 14. This points towards potential growth and expansion. Furthermore, 95% of the employees have a positive business outlook, indicating a healthy and motivated workforce.

On the customer acquisition and engagement front, Sea Limited has an estimated 410,000 visitors to its webpage, although this figure is down 18% over the past couple of months—an indicator that could suggest a decrease in customer interest or engagement. Likewise, the company's Twitter engagement remains stagnant with 1,600 followers, showing no growth in this metric.

Lastly, AltIndex provides an AI score designed to predict a company’s stock performance based on various analyses. Sea Limited has an AI score of 63, which translates to a "buy" signal.

Conclusion

Sea Limited demonstrates impressive growth metrics, especially with year-over-year increases in both revenue and net income. Nevertheless, the high P/E ratio and recent EBITDA decline could be causes for concern. Technical indicators show a potentially oversold stock, presenting a buying opportunity if the longer-term upward trend continues.

The alternative data paints a mixed picture, with positive employee sentiment and hiring trends but decreased web traffic and stagnant social media engagement. AltIndex’s AI scoring suggests a favorable buy signal.

In conclusion, based on the provided data, Sea Limited presents a compelling opportunity for long-term growth, albeit with some short-term risks. Investors should consider both the strong fundamental growth and the potential warning signs before making a decision.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.