Brazilian Billionaire Jorge Paulo Lemann Has Lost Faith in These 5 Tech Stocks

1. Sea Limited (NYSE:SE)

Former Value of 3G Capital‘s 13F Position: $67.1 million

Number of Hedge Fund Shareholders (as of March 31): 77

3G Capital is far from the only hedge fund that’s lost faith in Sea Limited (NYSE:SE) in recent quarters, as there’s been a 36% decline in ownership of SE since the end of Q3 2021. 3G Capital sold off its entire 300,000-share position in Sea Limited during the first quarter. Lee Ainslie’s Maverick Capital and Andreas Halvorsen’s Viking Global were also among the dozens of other hedge funds to unload their SE stakes during Q1.

While Sea Limited (NYSE:SE) is spending wads of money on its growth, that growth is impressive, coming in at 64% in terms of revenue in Q1. The company’s ecommerce platform Shopee grew revenue to $1.5 billion, while its gaming division’s revenue hit $1.1 billion. Those two platforms are working in tandem to promote and power the company’s Sea Money finance platform, which grew revenue by 363% in Q1, while active users surged by 78%. On the down side, the gaming division lost 5% of its active users, a trend which could eventually weigh on the company’s other segments should it persist.

The Baron New Asia Fund also lost faith in Sea Limited (NYSE:SE) during the first quarter and detailed some of the reasons why in its Q1 2022 investor letter:

“Sea Limited, a global digital gaming and e-commerce company, detracted from performance for the period held. Similar to other online consumer businesses, Sea faced significant multiple compression in the quarter, exacerbated by a slowdown in user growth at its key Free Fire digital game and mounting investments in its e-commerce operation, particularly in new markets like Brazil. We exited our position as we lost confidence in the long-term unit economics in some of Sea’s new markets and were concerned by the simultaneous slowdown in revenue growth and increase in underlying cash burn.”

For more on the latest trades made by some of the biggest hedge fund managers in the world, check out Billionaire Richard Chilton Is Selling These 10 Tech Stocks and Best Dividend Stocks to Buy Now According to The Zacks Rank.

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