HomeBusiness1 Unstoppable stock increase of 195% in 2024, which could double again...

1 Unstoppable stock increase of 195% in 2024, which could double again in 2025

Sea limited (NYSE:SE) is based in Singapore and serves the Southeast Asian market across three business segments: e-commerce, digital entertainment (gaming) and digital financial services.

The stock price is up a whopping 195% so far in 2024, thanks to improving economic conditions and the company’s accelerating revenue growth. It’s still 68% lower than the all-time high reached during the 2021 tech frenzy, so I think this recovery is still in its very early stages.

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This is why Sea Limited’s stock could double again (or more) in 2025.

E-commerce is Sea Limited’s largest source of revenue. Leading the charge is the company’s hybrid consumer-to-consumer and business-to-consumer Shopee platform, which processed more than 2.8 billion orders in the third quarter of 2024 (ended September 30).

Sea aims to improve the efficiency of Shopee’s logistics network to save money and provide customers with a better shopping experience. It’s succeeding as the company said during the third quarter that half of all orders in Asia were delivered in two days or less, while the cost per order continued to decline. E-commerce giant Amazon found that customers order more often when they receive products quickly, which is good news for Shopee in the long run.

Shopee also has powerful synergies with SeaMoney, the flagship brand in Sea’s digital financial services segment. It offers buy now, pay later loans to consumers on Shopee, and it also lends money to merchants on the platform to help them grow. SeaMoney ended the third quarter with a record $4.6 billion in loans outstanding, up a whopping 73% from the same period a year ago. During the quarter, 4 million new borrowers joined, bringing the total number of active users to 24 million.

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The third and final segment of Sea’s business is digital entertainment, which is led by the Garena mobile game development studio. It is home to Free firewhich remained the most downloaded mobile game in the world in the third quarter and averaged more than 100 million daily active users. Sea’s digital entertainment segment served a total of 628.5 million users in the quarter, up 15% from the same period last year.

Unfortunately, gaming has put a damper on Sea’s business since pandemic-era social restrictions ended, as people now spend less time online. The segment’s quarterly active users peaked at 729 million in 2021, so this has no each growth in the following three years. Monetization has also suffered, with the number of paying users down 46% from their pandemic-era peak.

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