Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Warren: Charlie, Sea Limited is one of those businesses that Wall Street has fallen in love with because of its growth rate. The stock is up enormously from its IPO, the revenue line is steep, and the management narrative is compelling. But when I look at this business through the lens of what we actually care about — durable competitive advantages, predictable cash flows, and a business we can understand ten years from now — I find myself reaching for the antacid rather than the checkbook. Charlie: The trouble with Sea Limited is that it operates three businesses simultaneously, each in a brutally competitive market, in geographies where the rules change overnight. E-commerce in Southeast Asia, mobile gaming globally, and consumer lending to first-time borrowers in developing economies. Any one of those would keep me up at night.
Recent filings analysed: 20-F (2025-04-17).
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