Bank of America upgraded Sea Limited to Buy from Neutral and raised its price objective to $215 from $206, citing stronger-than-expected momentum in e-commerce and gaming, with fintech providing additional upside.
Analysts said Sea’s shares have been range-bound in recent months despite improving fundamentals, and noted Tuesday’s 10% drop on concerns about Latin America expansion and slower margin gains as misplaced.
Shopee’s gross merchandise volume is rising, helped by recent increases in ad yields and commissions, while the platform continues to gain share in Brazil through lower prices and faster delivery.
Free Fire has also seen stronger traction in recent months, with expansion in emerging markets and new collaborations expected to sustain growth.
BofA raised its 2026 and 2027 earnings estimates by 3-5% to reflect higher take rates at Shopee and better gaming performance.
The bank kept valuation multiples unchanged for e-commerce and gaming but lifted its fintech multiple to 7 times from 5, pointing to sector re-ratings and growing traction in lending.
Sea’s fintech arm is expanding from on-platform payments to off-platform services and secured loans across markets, including Brazil. BofA sees this segment as an optional upside driver if loan growth can be achieved without higher non-performing assets.
source :
