In this article, we discuss 5 best Asian stocks to buy today. If you want to see more stocks in this selection, check out 13 Best Asian Stocks To Buy Today.
5. Sea Limited (NYSE:SE)
Number of Hedge Fund Holders: 48
Sea Limited (NYSE:SE) was incorporated in 2009 and is headquartered in Singapore. The company offers digital entertainment, e-commerce, and digital financial services in Southeast Asia, Latin America, rest of Asia, and internationally. Sea Limited (NYSE:SE) is one of the best Asian stocks to monitor. On March 7, Sea Limited (NYSE:SE) reported a Q4 non-GAAP EPS of $0.72 and a revenue of $3.45 billion, topping Wall Street estimates by $1.27 and $400 million, respectively.
On March 9, BofA raised the firm’s price target on Sea Limited (NYSE:SE) to $92 from $68 and kept a Neutral rating, following the company’s Q4 results that exceeded both BofA’s and market expectations. Although Sea Limited (NYSE:SE) did not provide FY23 guidance, BofA describes the commentary as “optimistic.” However, the firm remains cautious about Sea Limited (NYSE:SE)’s ability to maintain revenue growth with profitability. While BofA’s revenue estimates have not changed significantly, they have increased their EPS estimates for FY23/24E due to the expectation that positive net income will be sustained on an annual basis.
According to Insider Monkey’s fourth quarter database, 48 hedge funds were bullish on Sea Limited (NYSE:SE), compared to 55 funds in the prior quarter. Kora Management is the biggest stakeholder of the company, with approximately 4 million shares worth $206.8 million.
Here is what Hayden Capital has to say about Sea Limited (NYSE:SE) in its Q3 2022 investor letter:
“Sea Limited (NYSE:SE) reported earnings last week, after which the share price rebounded +36% in a single day. The most obvious question that comes to mind is why didn’t we sell more last year, when prices were still high? The truth is that we did sell a significant amount, but in hindsight obviously wish we were more aggressive with the sales.
For example, we owned the peak number of shares of Sea Ltd in Q1 2020, and steadily trimmed over the next two years. From Q1 2020 to Q1 2022, we trimmed ~39% of our shares over that period. However, the issue was that the investment continued to grow as a percentage of the overall portfolio, since the share price appreciated much faster than our sales (+620% from 1Q20 to 3Q21). This was a similar case for our other long-tenured positions as well.
So why didn’t we trim more aggressively and just hold cash? The answer is that at its core, I believe that holding cash is implicitly a market timing call. I certainly didn’t foresee a likely recession on the horizon so quickly after the turbulence of Covid already had on the economy. Even in late 2021, after it was clear interest rates would start rising, we were still operating under the assumption that rates would cause valuations to compress, but likely wouldn’t have an impact on the overall earnings trajectory. Given our expectations for strong earnings growth, we thought this could more than offset the valuation compression over time, and would still generate strong IRRs over a 3 – 5 year timeframe…” (Click here to see the full text)
