Is Sea Limited Stock a Buy After Its Alarming Earnings Report?

Shares of Sea Limited (NYSE: SE) crashed and burned on Tuesday, plunging in the wake of its fourth-quarter financial report. The results, which appear robust at first glance, show that trouble is brewing just beneath the surface.

The company's marquee mobile game -- Free Fire -- was the catalyst that helped launch Sea Limited's e-commerce and digital payments businesses, but the company is expecting a significant slowdown in gaming over the coming year. Given these challenges, is Sea Limited stock a buy, or should investors look elsewhere?

Sea Limited has evolved from a mobile game producer, parlaying the explosive popularity of Free Fire into a three-pronged business. The company's Garena video game segment is its only profitable business. Sea Limited has used the profits and cash flow from this unit to finance the growth of its e-commerce unit, Shopee, and its digital payments and fintech arm, Sea Money.

Source Fool.com