A Southeast Asian Gem
Sea Limited (SE)
Sea (SE) has long been one my favorite Southeast Asian stocks.
We have in the past been successful at finding a good entry point, taking profits along the way and exiting at an appropriate time.
Based in Singapore, Sea has three core businesses: 1) digital gaming/entertainment, 2) e-commerce, and 3) digital payments and financial services, known as Garena, Shopee, and SeaMoney, respectively.
Garena is a leading global online games developer and publisher and has been a key driver of the stock. Garena is responsible for some of the world’s most popular mobile games such as Free Fire, Call of Duty: Mobile, and EA Sports FC. It had over 633 million users during the fourth quarter of 2025
Shopee is the largest e-commerce platform in Southeast Asia and Taiwan. The company attempted to expand to other markets such as Latin America, but this proved unsuccessful. Shopee processed 13.9 billion orders worth $127.4 billion during 2025 – both record highs. Sea is deriving more revenue out of Shopee customers by selling digital ads on the platform. It’s also improving its logistics network to deliver faster in this competitive market.
Next comes Monee, a leading digital payments and financial services provider in Southeast Asia. This segment also has nice margins and is part of a rapidly growing payment ecosystem. Monee had 37 million active borrowers at the end of 2025, growth of 40% year over year. It also held $9.2 billion in loans to its members and Shopee merchants, which was up by an impressive 80%.
Now we get to financials.
Sea stock is down about 55% in last six months. Since September 1, 2025, Sea stock has gone from 194 to 83 before rising 7 points yesterday.
Sea stock is trading about 27 times forward earnings - a great entry point.
Sea has a strong balance sheet ending 2025 with $11.1 billion in cash and equivalents on hand against just $510 million in debt. The company has successfully moved to profitability through Shopee’s $881 million and SeaMoney’s $1 billion in adjusted earnings before taxes.
Recent momentum in the stock is underlined by significant stake increases by Steve Cohen and Stanley Druckenmiller. This indicates growing confidence in Sea’s long-term growth potential.