Bernstein reiterates Outperform rating on Sea Ltd stock with $180 target

Investing.com - Bernstein maintained its Outperform rating and $180.00 price target on Sea Ltd. (NYSE:SE) following the company’s second-quarter results. The stock has shown remarkable momentum, surging 18% in the past week and trading near its 52-week high of $178.

The research firm highlighted a fundamental shift in Sea Ltd.’s investment narrative, noting that growth is no longer driven by a single segment but is now diversified across multiple business lines. With a "GREAT" financial health score according to InvestingPro, the company has demonstrated robust execution across its operations.

Bernstein observed that what was previously a predominantly e-commerce-focused business now has gaming and fintech emerging as significant earnings contributors, positioning Sea Ltd. as one of the few ASEAN tech platforms with diversified cash flow streams.

The company outperformed across all three of its business segments in the second quarter, according to Bernstein’s analysis, reinforcing the firm’s positive outlook on the stock.

Bernstein expects Sea Ltd.’s EBITDA growth trajectory to strengthen going forward, with the firm seeing "further scope for upward revisions in EBITDA" as all business segments continue to perform well.

In other recent news, Sea Ltd has seen a series of analyst updates following its strong second-quarter results. Jefferies increased its price target for Sea Ltd to $196, citing impressive growth in its e-commerce platform, Shopee, particularly in Brazil. Similarly, Bernstein raised its target to $180, highlighting Sea Ltd’s remarkable transformation and successful execution over the past 18 months. Loop Capital also lifted its price target to $190, maintaining a Buy rating, as it foresees stronger performance in Sea’s e-commerce and gaming segments. The firm noted Shopee’s improvement, with its EBITDA margin reaching 0.9% of GMV, suggesting potential for further growth.

Conversely, Phillip Securities downgraded Sea Ltd’s stock rating to Neutral, despite raising its price target to $160. This adjustment reflects the recent rally in Sea Ltd’s stock and acknowledges growth prospects in its digital financial services and entertainment platforms. These recent developments indicate a mix of optimism and caution among analysts regarding Sea Ltd’s future performance.

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