JPMorgan cuts Sea Ltd stock rating, lowers target to $135

On Wednesday, JPMorgan analysts downgraded Sea Ltd. (NYSE:SE) stock rating from Overweight to Neutral and decreased the price target to $135 from $160. The downgrade came after the stock experienced a significant rally, with a 244% increase from its January 2024 lows, contrasting with the NASDAQ’s 13% rise during the same period. According to InvestingPro data, SE shares have delivered an impressive 112% return over the past year, with the stock currently trading at $119.75. Year to date, Sea Ltd. shares have risen 13%, while the NASDAQ has seen a 13% decline.

Analysts at JPMorgan noted that Sea Ltd.’s rally was bolstered by material earnings revisions, with Bloomberg consensus revisions for 2026 earnings per share (EPS) increasing by 70% over the past 12 months. This aligns with InvestingPro data showing strong financial health metrics, including a robust current ratio of 1.49 and an Altman Z-Score of 4.52, indicating solid financial stability. However, concerns were raised regarding potential macroeconomic headwinds and softer consumer spending that could impact gross merchandise volume (GMV) growth and advertising spending. InvestingPro subscribers can access 15+ additional key metrics and insights about SE’s financial health in the comprehensive Pro Research Report.

The report also highlighted the possibility of Sea Ltd. facing challenges in increasing seller commissions due to the uncertain macroeconomic environment. Furthermore, SeaMoney, Sea Ltd.’s digital financial services arm, may encounter risks associated with higher credit costs and the need to optimize lending.

JPMorgan has adjusted its FY25/26E adjusted EBITDA forecast for Sea Ltd. downward by 5%, primarily due to anticipated performance changes in the Shopee and SeaMoney segments, although this is partially mitigated by higher earnings expectations for Garena, the company’s digital entertainment arm.

Concluding the report, JPMorgan revised their valuation multiples for Sea Ltd.’s e-commerce and fintech operations to 25 times (from 28 times) and 12 times (from 15 times) respectively. This valuation adjustment led to the reduction of their December 2025 price target to $135, reflecting a more cautious outlook on the company’s growth prospects and market uncertainties. Based on InvestingPro’s comprehensive analysis, SE currently trades at an EV/EBITDA multiple of 58.6x, with the company maintaining strong revenue growth of 28.75% over the last twelve months. Investors seeking detailed valuation insights and growth projections can access the full Pro Research Report, which includes expert analysis of SE’s competitive position and growth trajectory.

In other recent news, Sea Ltd has seen several updates from analysts regarding its stock price targets and ratings. UBS raised its price target for Sea Ltd to $176, maintaining a Buy rating, following the company’s fourth-quarter 2024 results that surpassed expectations. The firm noted strong growth and improved margins in both e-commerce and fintech segments. Similarly, Barclays (LON:BARC) increased its price target to $182, highlighting Sea Ltd’s e-commerce performance, which exceeded expectations with a significant year-over-year increase in Gross Merchandise Value (GMV).

Loop Capital also raised its price target to $165, citing a positive outlook on Sea Ltd’s long-term earnings potential across its business segments. Benchmark adjusted its price target to $150, maintaining a Buy rating, due to Sea Ltd’s robust fourth-quarter performance and promising guidance for 2025. Additionally, Phillip Securities upgraded Sea Ltd’s stock rating to Neutral and raised the price target to $140, following a notable revenue increase driven by the e-commerce platform Shopee and digital financial services.

Analysts have consistently highlighted Sea Ltd’s strong market position and growth potential in e-commerce, fintech, and gaming. The company’s management has provided optimistic guidance for 2025, with expectations for continued growth in GMV and profitability. These developments reflect a broad confidence among analysts in Sea Ltd’s ability to capitalize on its market opportunities and sustain its growth trajectory.

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