Sea, Shopee, Garena Trending as Analysts Turn Positive

Analysts are intrested in these 5 stocks: ( (SE) ). Here is a breakdown of their recent ratings and the rationale behind them.

Sea Ltd is returning to the spotlight as analysts argue that most of the bad news is already reflected in the share price. Hussaini Saifee has upgraded the stock to Buy, seeing an attractive balance between risk and potential reward after the shares fell about a third from their 2025 highs. The analyst keeps a 12‑month target of 156 dollars, implying solid upside from the current 127.57 dollars, and highlights that Sea’s core growth engines in e‑commerce, gaming and digital finance remain largely intact. In his view, the market has already priced in many of the earnings cuts and competitive pressures, opening the door for a positive re‑rating if execution holds.

The main story for investors remains Shopee, Sea’s e‑commerce arm, where ASEAN markets account for roughly three‑quarters of gross merchandise value and continue to look healthy. Saifee notes that Lazada, owned by Alibaba, is effectively acting as a “share donor,” helping Shopee gain market share and adding an estimated 3–4 percentage points to Shopee’s GMV growth. The analyst expects the current phase of heavy investment and competitive jostling to lead eventually to a more rational, two‑player landscape in Southeast Asia. That, in turn, could set up stronger monetisation and margin expansion for Shopee from 2027 onward.

In the near term, margins will be pressured by Shopee’s VIP program and intense competition in newer markets, but Saifee views these as strategic rather than structural problems. The VIP program, designed to keep high‑value customers spending on Shopee and to speed up the shift from offline to online shopping, may slightly dent 2026 profitability, with an estimated 0.1 percentage point drag on margins. The bear‑case scenario assumes tougher rivalry in Brazil and higher VIP‑related spending, which could compress Shopee’s margins by about 20–30 basis points and even push Brazil into losses. Still, the analyst argues that these risks are already reflected in street expectations, limiting further downside.

Beyond commerce, the report points to Monee, Shopee’s “buy now, pay later” and micro‑lending platform, as a hidden growth engine that many investors may be underestimating. As GMV grows, Monee’s lending volumes rise, and the unit earns much higher yields than basic marketplace fees, with instalment returns in the 20–40% range and relatively low non‑performing loans around 1.1% at 90 days. Saifee forecasts Monee’s loan book, revenues and EBITDA to grow by roughly a third in 2026, underscoring its potential as a high‑margin, scalable profit driver that enhances overall group monetisation.

On the gaming side, the analyst acknowledges ongoing concerns over Garena’s dependence on a single flagship title and the natural ups and downs of game spending. Growth is expected to slow to around 5% in 2026, and a decline in bookings is possible after a blockbuster 2025, echoing the volatility seen at peers like Krafton. However, Saifee stresses that this risk is more limited than many fear, because Garena now accounts for only about 15% of his sum‑of‑the‑parts valuation. With solid cash levels (net cash on the balance sheet through at least 2027), diversified operations and multiple monetisation levers, the upgrade to Buy frames Sea as a company where the structural story is still intact while the market’s expectations have turned overly cautious.