Big Changes Could Be Coming to Sea Limited Stock. Time to Buy?

Sea Limited (NYSE: SE) stock is plunging as the company contemplates some major changes. The company has built cloud infrastructure to better run its gaming, e-commerce, and fintech businesses, and now wants to open its cloud to external customers. Additionally, CEO Forrest Li is considering spinning off the fintech arm, Monee.

The stock has plunged on this news, losing more than 17% of its value since Oct. 15. Although the possibility of that move introduces uncertainty, I think investors should consider the drop in the retail stock a buying opportunity. Here's why.

Image source: The Motley Fool.

The uncertainty surrounding Sea Limited

To be sure, Sea Limited's handling of the news surrounding its cloud and fintech moves may have fostered more uncertainty than optimism. Indeed, the demand for cloud infrastructure is massive in today's tech market, especially for AI workloads. That implies the new segment, called Sea Cloud, could perform well. Also, with competitors like Amazon and Alibaba operating cloud businesses, the move is hardly unusual.

Still, even Amazon has had to take on considerable debt to fund its build-out. That causes investors to wonder how much added cost Sea Limited is assuming. The uncertainty may increase with a potential spinoff of Monee. Monee is the company's fastest-growing segment, and Li believes this move could give it added flexibility and a stronger ability to raise capital.

However, Sea Limited benefits from synergies between Monee and the company's other segments. Li did not clarify if or how Monee would still work with Sea if it were a separate company.

Moreover, while such spin-offs usually grant shareholders shares in the new company, investors do not yet know what that allocation would look like. That fact may discourage investors from buying without the specifics of such a deal.

Why investors may want to buy anyway

Whatever happens with these moves, it looks increasingly like the selling in Sea Limited stock is overdone. In the first half of 2026, it generated $14.9 billion in revenue, a 47% gain over the same period last year. Of the three segments, Monee's growth was the fastest, increasing by 58% over the same period. Still, even without Monee, this would be a fast-growing company, especially once Sea Cloud launches.

Also, its $869 million in net income for the first half of 2026 is only 7% higher than year-ago levels. Still, it invested more heavily in its operations, a move that should boost its revenue and profits in the long term. Thus, investors should probably give the company some leeway here.

Additionally, amid the falling stock price, the company's shares sell at a price-to-earnings (P/E) ratio of 30. Considering how fast the company has grown (even without Monee), Sea Limited's stock looks like an attractive value for the money.

Consider Sea Limited stock

Ultimately, the company's growth relative to valuation is alone an excellent reason to buy Sea Limited stock. Indeed, the potentially high cost of a cloud build-out may discourage investors from buying. One can say the same about the uncertainty about a potential Monee spinoff.

However, the company's revenue growth is rapid with or without Monee. When also considering its relatively low P/E ratio, investors are unlikely to go wrong if they plan to buy on the dip.

Will Healy has positions in Sea Limited. The Motley Fool has positions in and recommends Amazon and Sea Limited. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.