The valuation of Free Fire is intrinsically linked to the performance of its parent company, Sea Limited (NYSE: SE), a Singapore-based technology conglomerate. Free Fire is the flagship title of Sea’s digital entertainment arm, Garena.
Here is a professional summary of the stock’s valuation, performance, and outlook:
1. Key Corporate Context
- Parent Company: Sea Limited (SE), listed on the New York Stock Exchange (NYSE).
- Segment: Free Fire is the primary revenue driver for the Garena (Digital Entertainment) business segment.
- Business Diversification: Sea Ltd. is a holding company for three core businesses, which diversifies its revenue streams:
- Garena: Digital Entertainment (including Free Fire).
- Shopee: E-commerce (Southeast Asia’s largest platform).
- SeaMoney: Digital Financial Services.
2. Stock Performance and Recent Trends
- Current Stock Price: As of December 2025, the SE stock price is around $124 – $128 USD.
- Market Capitalization: The company’s market cap is approximately $74 – $76 billion USD.
- Historical Volatility: Sea Ltd.’s stock has experienced significant volatility. It saw massive growth in 2020/2021, followed by a sharp decline in 2022/2023, and a strong rebound in 2024/2025.
- 2024 Performance: The stock had a strong year, showing an increase of approximately 175.94% in 2024.
- 1-Year Change: The price increased by around 10% to 17% over the past year.
- Valuation Multiples:
- Forward P/E Ratio: Trading at a forward 12-month Price-to-Earnings ratio of around 24.35x, which is generally lower than the broader Technology sector’s average (approx. 29.07x).
- P/E Ratio (TTM): The trailing 12-month P/E ratio is relatively high, around 55x to 57x, reflecting high growth expectations.
3. Free Fire’s Impact and Risk
- Revenue Contribution: While Free Fire and Garena’s performance have stabilized, the company’s valuation remains heavily dependent on the success and demand for Free Fire.
- Revenue Trends: Free Fire’s revenue has stabilized in 2024 ($408 million) after a decline following the peak in 2021 (before the India ban).
- User Base: Daily Active Users (DAU) for Free Fire reached over 100 million peak in February 2024, indicating strong demand.
- Dependence Risk: Market analysts note that a high dependence on Free Fire for Garena’s growth poses a risk. However, the company is attempting diversification with new launches and collaborations.
4. Analyst Consensus and Outlook
- Consensus Rating: The general consensus among Wall Street analysts is “Strong Buy” for Sea Limited stock.
- Average Price Target (12-Month): The average analyst price target is in the range of $189 to $194 USD, implying an estimated 50% to 52% upside from the current trading price.
- Target Range: The high estimate is around $226 USD, and the low estimate is around $138 USD.
- Growth Forecast: Analysts anticipate substantial growth for Sea Ltd., including:
- Next Year EPS Growth: Expected surge of over 54% to 280% compared to the previous year.
- Next Year Revenue Growth: Expected growth of around 24% to 35%.
Free Fire
Sea Limited (SE), the stock tied to Free Fire’s success, is viewed by most analysts as a Strong Buy with significant upside potential. The bullish sentiment is driven by the company’s return to profitability, strong execution across its e-commerce (Shopee) and digital finance (SeaMoney) segments, and the continued robust demand for Free Fire, which has seen its daily active user base stabilize at high levels. The primary risk remains the degree of revenue concentration in the Free Fire franchise.