Reviewing SEA (SE) and Cheetah Mobile (CMCM)

SEA (NYSE: SE) and Cheetah Mobile (NYSE:CMCM) are both mobile application software companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, dividends, analyst recommendations, risk and valuation.

Analyst Ratings

This is a summary of recent ratings and target prices for SEA and Cheetah Mobile, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SEA	0	1	5	0	2.83
Cheetah Mobile	0	3	0	0	2.00

SEA currently has a consensus price target of $18.67, indicating a potential upside of 40.04%. Cheetah Mobile has a consensus price target of $11.67, indicating a potential downside of 2.45%. Given SEA’s stronger consensus rating and higher possible upside, equities research analysts clearly believe SEA is more favorable than Cheetah Mobile.

Insider & Institutional Ownership

68.7% of SEA shares are owned by institutional investors. Comparatively, 7.1% of Cheetah Mobile shares are owned by institutional investors. 0.2% of SEA shares are owned by insiders. Comparatively, 17.1% of Cheetah Mobile shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares SEA and Cheetah Mobile’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	NetIncome	Earnings Per Share	Price/Earnings Ratio
SEA	N/A	N/A	N/A	N/A	N/A
Cheetah Mobile	$657.45 million	2.61	-$11.59 million	$0.36	33.22

SEA has higher revenue, but lower earnings than Cheetah Mobile.

Profitability

This table compares SEA and Cheetah Mobile’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SEA	-90.49%	N/A	-39.28%
Cheetah Mobile	7.44%	11.03%	6.50%

Summary

Cheetah Mobile beats SEA on 5 of the 9 factors compared between the two stocks.

About SEA

Sea Limited, formerly Garena Interactive Holding Limited, is a Singapore-based Internet and mobile platform company. The Company is a platform provider for online personal computer (PC) and mobile digital content, e-commerce and payments across Asia. The Company offers Garena+, an online platform for people to meet, chat and play games with each other. Its digital content offers Garena, which is a game and social platform for gamers to interact, discover, download and play PC and mobile games. PC games on Garena Platform include Point Blank, Path of Exile, Mstar Online, League of Legends, Heroes of Newerth, Alliance of Valiant Arms, Mabinogi Heroes and Lost Saga. Mobile Games on Garena Platform include Headshot and Thunder Strike. Its ESports Events include Garena Premier League, Garena Carnival, Garena Cyber Games, Garena Star League and League of Legends Master Series. Its e-commerce offers Shopee, a mobile marketplace, where users can browse, shop and sell their products.

About Cheetah Mobile

Cheetah Mobile Inc. is a holding company. The Company and its consolidated subsidiaries, variable interest entities (VIEs) and a VIE’s subsidiary are engaged in the provision of online marketing services, Internet value-added services, and Internet security services and others. The Company operates a platform that offers mobile and personal computer (PC) applications for its users and global content promotional channels for its customers, both of which are powered by its cloud-based data analytics engines. For its users, its diversified suite of applications optimizes mobile and PC Internet system performance, and provides real time protection against known and unknown security threats. Its data analytics engines perform real time analysis of mobile applications, program files and Websites on their devices for behavior that may impair system performance or impose security risks.

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