Billionaire Steve Cohen Is Selling These 5 Stocks

1. Sea Limited (NYSE:SE)

Number of Hedge Fund Holders: 111

Sea Limited (NYSE:SE) was one of the oldest stock holdings in billionaire Steve Cohen’s portfolio, as the firm first bought a stake in the tech-focused conglomerate in 2018. It dumped its entire SE position in the December quarter of 2021. The company’s shares were among the best performers over the past two years, however, they’ve plunged by more than 50% year-to-date due to investors’ move towards value stocks.

In its fourth quarter investor letter, investment management firm Hayden Capital mentioned a few stocks, including Sea Limited. Here is what Hayden Capital stated:

“Sea Ltd represents a substantial portion of our portfolio, and this last market downturn has certainly been painful for shareholders. While I’d estimate (or rather guess?) that ~2/3rd of the stock price decline is due to concerns around the aforementioned rising rate environment hurting most long-duration growth companies, approximately ~1/3rd of the stock decline is likely due to investor’s concerns around Sea Ltd transitioning from “Act 1” to “Act 2”, which I’ll discuss in this section.

Previously, Sea has relied upon the exponential growth of its gaming business, Garena, and in particular that of the worldwide mobile game sensation, Free Fire, to provide the profits to reinvest into the Shopee ecommerce division within Southeast Asia. Between 2018 and 2021, profits from Garena grew over 10x, all of which was reinvested into building out the Shopee ecommerce platform.

This strategy has been tremendously successful, with Shopee now on track to achieve ~$100 Billion in GMV in 2022, making it one of the largest ecommerce companies in the world. More importantly, these new-to-ecommerce customers are extremely sticky (ordering more than 4x per month, logging in several times per day, and spending 30 – 60 minutes inside of the app per day).

This isn’t simply “renting customers” via deeply discounted promo codes. But rather, Shopee has trained a whole new segment of the population to shop online via their addictive & engaging platform. Nowadays, Shopee is definitively the dominant ecommerce leader in Southeast Asia (~55 – 60% market share), and the company feels that it is in a much more stable position versus just a few years ago…” (Click here to see the full text)

You can also take a look at the Billionaire Ken Griffin Is Loading Up on These 10 Stocks and 10 Best Pharmaceutical Stocks to Buy in 2022.

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