(Oct 19) Sea Ltd reached an all-time high at 366.90.
About Sea Limited
A fifth and final company thatcould become one of the largest stocks by 2040is Singapore-based Sea Ltd. Sea sits just inside the top 50, at the moment, with a market cap of nearly $200 billion.
Sea's secret weapon is that it has not one or two, but three rapidly growing operating segments. For the time being, the company's gaming division is the only one generating positive earnings before interest, taxes, depreciation, and amortization (EBITDA). The company had approximately 725 million mobile game users in the second quarter, 12.7% of which were paying to play. This is a pay-to-play conversion rate that's well above the industry average of closer to 2%.
But the real lure here is the e-commerce platform Shopee, which is the most downloaded shopping app in Southeastern Asia and is also gaining steam in Brazil. Shopee is primarily targeting emerging market countries and has delivered jaw-dropping growth over the past couple of years. For instance, the $15 billion in gross merchandise value (GMV) purchased in the second quarter places Shopee's annual sales run rate 500% higher than the GMV produced in all of 2018.
Lastly, the company's digital financial services segment can be a hit in underbanked emerging markets. Despite being a relatively new division, it already has close to 33 million paying mobile wallet customers. Together, these segments give Sea Limited a real shot tohandily surpass a $1 trillion valuation.
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