Shares of Sea Limited (NYSE:SE) finished last month up 14%, according to data from S&P Global Market Intelligence. There was little company-specific news driving shares of the Southeast Asian tech company higher, but the stock seemed to benefit from macroeconomic developments and bullish momentum in e-commerce stocks during the month.
As the chart below shows, the stock's movement was erratic, but a surge at the end of the month gave it double-digit gains for July.
Sea Limited shares surged to start the month as Stephens initiated coverage with an overweight rating and a price target of $130. Analyst Jeff Cohen noted "very favorable demographics" in its home region, and strong prospects for all three of its business segments: digital gaming, e-commerce, and online payments.
The following week, the stock climbed again on another bullish analyst note as Citigroup raised its price target from $79 to $138. Analyst Alicia Yap noted strong growth in its Shopee e-commerce marketplace and Garena gaming platform from the effects of the coronavirus pandemic. Yap wrote that those shifts would be structural, helping to accelerate the company's long-term growth. The same day, App Annie said that Garena's Free Fire was one of the top-performing mobile gaming apps in the world in the second quarter, ranking No. 3 in downloads and No. 5 in monthly active users.
Finally, at the end of the month, the stock gained in synchrony with several strong earnings reports from e-commerce stocks, including Shopify and Amazon.
Sea Limited has been among the better-performing stocks on the market this year, gaining 206% year-to-date. Its digital gaming, e-commerce, and online payment businesses are all well-positioned to thrive during the pandemic. Given the stock's momentum and the company's positioning, investors are expecting the company to deliver a strong earnings report on August 18.
Analysts see revenue jumping 72.5% to $1.06 billion, and its loss per share narrowing from $0.52 to $0.42.