Bernstein SocGen Group has trimmed its price target on Sea Ltd. (NYSE:SE) to $170.00 from $185.00 but kept an Outperform rating on the stock, the firm said. The revised target remains meaningfully above Sea’s current trading level of $108.71, according to InvestingPro data that also shows an analyst consensus rating of 1.27 - classified as Strong Buy.
Venugopal Garre, the Bernstein SocGen analyst, described the recent pullback in Sea’s share price as driven by AI-related market moves that he believes are overdone. Garre suggested the company is positioned to benefit from advances in artificial intelligence rather than be disadvantaged by them.
Sea’s equity has lost about half of its market value overall, a decline Bernstein SocGen attributes to both fundamental concerns and what it calls the market’s difficulty in pricing uncertainty around the company. The stock is trading close to its 52-week low of $99.50 and has fallen 26.41% over the past six months, with InvestingPro data indicating the shares appear undervalued on current metrics.
Bernstein SocGen highlighted several factors that have brought Sea under heightened scrutiny: shifting market dynamics, rapidly evolving technology in its operating environment, business segments that can be difficult to predict, and a lack of a stable long-term investor base. Those elements, the firm said, have contributed to investor caution and pricing volatility.
Despite these headwinds, Bernstein SocGen maintains that there is "room for good returns" for shareholders. Part of the firm’s view is informed by proprietary price tracking data that examines on-the-ground trends for Sea, which the analyst used to support the more constructive return outlook.
Corporate actions and third-party reassessments have coincided with Bernstein SocGen’s revised target. Sea Limited’s board has authorized a $1 billion share repurchase program; the company said the timing and the pace of any buybacks will be subject to market conditions and other relevant factors.
Independent brokerages have also adjusted their stances on the company. Maybank Kim Eng upgraded Sea from Hold to Buy, citing what it called an attractive risk-reward profile after the notable correction in the share price. Phillip Securities likewise upgraded its rating to Buy, keeping a price target of $170.00 and pointing to improved growth expectations across all business segments. Phillip Securities also raised its revenue forecasts for Sea for fiscal year 2025 by 3% and for fiscal year 2026 by 4%.
Those broker upgrades and the board-approved repurchase program have been framed by analysts as a positive reassessment of Sea’s near-term prospects. Investors will likely weigh these developments alongside the company’s structural challenges and market volatility as they assess Sea Limited’s future performance.
Key points
- Bernstein SocGen lowered its price target for Sea Ltd. to $170.00 from $185.00 while maintaining an Outperform rating.
- Sea is trading near $108.71, close to a 52-week low of $99.50, and has declined about 26.41% over the past six months; InvestingPro shows a consensus rating of 1.27 (Strong Buy).
- The company announced a $1 billion share repurchase program and received upgrades from Maybank Kim Eng and Phillip Securities, the latter keeping a $170.00 target and raising revenue forecasts for FY2025 and FY2026 by 3% and 4%, respectively.
Risks and uncertainties
- Persistent uncertainty around Sea’s fundamentals and market dynamics could continue to pressure the stock and affect valuation - this impacts equity investors and market participants focused on technology and internet sectors.
- Rapid technological change and unpredictable business-segment performance increase scrutiny and could lead to further volatility - relevant to technology, e-commerce, and digital services sectors.
- The absence of a stable long-term investor base may exacerbate share price swings and complicate capital planning or buyback execution - affecting broader market liquidity considerations.