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Sea Limited (SE) to Report Q2 Earnings: What's in Store?

Zacks Equity Research
·3-min read

Sea Limited SE is set to release second-quarter 2020 results on Aug 18.

The Zacks Consensus Estimate for loss has been unchanged at 57 cents per share over the past 30 days. Sea Limited reported a loss of 37 cents per share in the year-ago quarter.

Moreover, the consensus mark for revenues is currently pegged at $1.03 billion, indicating 55.5% growth from the year-ago quarter’s reported figure.

The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, missing the same in one, the average beat being 5.42%.

Sea Limited Sponsored ADR Price and EPS Surprise

 

Sea Limited Sponsored ADR Price and EPS Surprise
Sea Limited Sponsored ADR Price and EPS Surprise

Sea Limited Sponsored ADR price-eps-surprise | Sea Limited Sponsored ADR Quote

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Let’s see how things shaped up prior to this announcement.

Factors at Play for Q2 Results

Sea Limited’s digital entertainment (Garena) and e-commerce businesses are expected to have capitalized on the coronavirus outbreak in the second quarter.

Garena is likely to have benefited from the continued popularity of Free Fire. Per Sensor Tower data, the game was the third most-downloaded mobile game in June, globally. According to App Annie data cited by VentureBeat, Free Fire dominated the action category in second-quarter 2020.

The game’s immense fame can be attributed to coronavirus-led school closures amid lockdowns and social distancing.

Moreover, the company’s e-commerce segment is likely to have gained from a strong uptick in Shopee, its online shopping platform.

Gross orders totaled 429.8 million, up 111.2% year over year in the first quarter of 2020, a trend that most likely continued in the to-be-reported quarter.

Moreover, SeaMoney’s strengthening integration with Shopee is expected to have aided Sea’s digital financial services business.

However, higher expenses related to expansion of e-commerce services and continued efforts to integrate the company’s mobile wallet services with Shopee platform across different markets is expected to have negatively impacted profitability in the to-be-reported quarter.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Sea Limited has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering from the same sector as our model shows that these have the right combination of elements to beat on earnings this reporting cycle:

Agilent Technologies A has an Earnings ESP of +5.00% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Autodesk ADSK has an Earnings ESP of +4.44% and is #3 Ranked.

Bill.com BILL has an Earnings ESP of +10.45% and a Zacks Rank #3.

These Stocks Are Poised to Soar Past the Pandemic

The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.

Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.

See the 5 high-tech stocks now>>


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Autodesk, Inc. (ADSK) : Free Stock Analysis Report
 
Sea Limited Sponsored ADR (SE) : Free Stock Analysis Report
 
Agilent Technologies, Inc. (A) : Free Stock Analysis Report
 
Bill.com Holdings, Inc. (BILL) : Free Stock Analysis Report
 
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Zacks Investment Research