Sea Ltd (SE: NYSE)

Sea Limited (SE) is a digital entertainment, e-commerce, and digital financial services company based in Singapore. Following the decision to restart growth investments in the third quarter last year, these efforts are showing promising results. While e-commerce impacted headline earnings, management has raised Shopee’s gross merchandise volume forecast for the year to mid-20% growth, up from the initial target in the high teens. Shopee’s growth, coupled with signs of recovery in the gaming division, is encouraging for investors.

Sea Limited anticipates double-digit revenue growth in 2024, excluding a potential Free Fire relaunch in India, which could provide a further boost to Garena, Sea’s gaming division. After experiencing difficulties in early 2022, Free Fire’s daily active user base has rebounded, growing from a low of 528.7 million in Q4 2023 to 648 million in Q2 2024, marking a 19% year-over-year increase.

We are bullish on SE above $67.00-$68.00, with an upside target of $130.00-$135.00.

Sunrun (RUN: NASDAQ)

Sunrun (RUN) is a solar energy developer and installer for residential properties in the United States. Interest rates have been a key concern for renewable energy companies, as projects are often financed over multiple decades. Rising rates have made these projects less economical, negatively impacting the industry over the past couple of years. However, the recent announcement of a rate-cutting cycle is expected to provide a significant boost to Sunrun’s stock price in the near term.

Another positive catalyst for energy stocks like Sunrun is the U.S. Treasury Secretary Janet Yellen’s focus on China’s market practices. She has accused China of flooding the global market with competitively priced green energy products, including solar components. Yellen plans to address these concerns with Chinese authorities during an upcoming visit, and if successful, this could provide a substantial benefit to Sunrun.

Additionally, the Biden Administration continues to prioritize the development of clean energy as a major economic sector. Through the Inflation Reduction Act passed in 2022, federal funding is being directed toward clean energy initiatives. Subsidies from this effort could reduce Sunrun’s operating expenses and significantly enhance its profitability.

We are bullish on RUN above $17.50-$18.00, with an upside target of $29.00-$30.00.