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Sea Limited reported another quarter of 30% growth atop healthy free cash flow generation. Today, I will walk through each line of business, as well as the overall thesis, in detail. However, I'd just like to simplify everything: Sea Limited is a business growing at 30% while generating substantial free cash flow in each of its lines of business.

One of Schaeffer's top stock picks for 2025 , Sea Ltd (NYSE:SE), has been rallying on the charts after bouncing off newfound support at the $100 level.

SE appears well positioned to deliver on its aggressive FY2025 guidance, as observed in the robust FQ1'25 performance metrics. With all three of its business segments being highly profitable on an individual basis, it is unsurprising that SE continues to report high growth and profitable cadence thus far. The same may occur over the next few years, as the Southeast Asian region may report over +5% in GDP growth and +14.2% in e-commerce sales growth.

I'm upgrading Sea to a neutral rating based on the company's recent recovery in active gaming users and paid user ratios. The company ran several in-game promotions and collaborations that brought DAUs close to pandemic-era peaks. At the same time, SE's e-commerce segment is hitting record profitability, with emerging markets like Brazil also contributing to the bottom line.

SEA is Southeast Asia's e-commerce leader, excelling in vision, execution, and now sustainable free cash flow generation. Shopee, SEA's e-commerce platform, is turning profitable, with potential for 12% EBITDA margin by 2027 and significant earnings growth. Valuation is attractive at 0.7x PEG, with a 2025 price target of $205 and over 100% upside potential by 2027.

Sea Limited (SE -1.97%) is home to the largest e-commerce platform in Southeast Asia, but it also operates one of the world's most successful mobile game development studios and a booming digital financial services business. The company is based in Singapore, so it's somewhat insulated from the rising global trade tensions that center around the U.S., triggered by President Donald Trump's "Liberation Day" tariffs.

SE Q1 results reflect strong gains in E-commerce and Digital Finance, though revenue miss and macroeconomic pressures remain key concerns.

Sea Limited (NYSE:SE ) Q1 2025 Results Conference Call May 13, 2025 7:30 AM ET Company Participants Elson Choi - Investor Relations Forrest Li - Chairman & Chief Executive Officer Tony Hou - Chief Financial Officer Chris Feng - President Conference Call Participants Pang Vitt - Goldman Sachs Piyush Choudhary - HSBC Alicia Yap - Citigroup Divya Kothiyal - Morgan Stanley Jiong Shao - Barclays John Choi - Daiwa Operator Good morning, and good evening to all, and welcome to the Sea Limited First Quarter 2025 Results Conference Call. All lines have been placed on-mute to prevent any background noise.

The headline numbers for Sea Limited (SE) give insight into how the company performed in the quarter ended March 2025, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.

U.S.-listed shares of Sea Limited (SE) jumped more than 8% Tuesday after the online commerce, banking, and gaming provider posted better-than-expected profit as all three of its units had sales gains.