SE – Daily Chart
The price of SE is trading at $97.46 and will look for a breakout between $88.50 and $100.
SE’s earnings missed estimates in all the trailing four quarters, delivering a negative earnings surprise of around 75% on average. That could put the support level under pressure if the trend continues.
SE’s third-quarter performance is expected to have benefited from its core businesses, which include e-commerce (Shopee), digital financial services (SeaMoney), and entertainment (Garena).
Sea expects Shopee to report positive earnings in the third quarter of 2024 due to its strong market share in Southeast Asia, improving ad revenue and logistics efficiency.
The company has placed a recent importance on ad revenue, which is currently below the industry average. The company has already seen positive results, with a 20% year-over-year increase in sellers paying for ads in the second quarter of 2024. This improvement in ad monetization is expected to continue in the current quarter.
SE is also expected to benefit from a demand for logistics operations, which adds to reduced order costs. This is likely to have improved customer experience, driven by the courier platform, SPX Express.
Growing digital financial services to customers is likely to have added users and revenue growth in the quarter. SeaMoney’s loan book is expected to continue expanding, with more users and increasing loan sizes. The strong growth in consumer and SME credit businesses, particularly through Shopee, is expected to have contributed positively to Sea Limited’s revenue in the to-be-reported quarter.
Free Fire’s continued popularity, with over 100 million daily active players, is expected to remain a significant revenue driver for the company and the launch of new games like Need for Speed: Mobile in different markets is expected to have further boosted the Digital Entertainment segment in the third quarter.