Is Sea (NYSE:SE) A Risky Investment?
@lolmei:
Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility of prices, but whether you will suffer a permanent loss of capital.' It's only natural to consider a company's balance sheet when you examine how risky it is, since debt is often involved when a business collapses. We note that Sea Limited(NYSE:SE$Sea Ltd(SE)$ ) does have debt on its balance sheet. But is this debt a concern to shareholders?Why Does Debt Bring Risk?Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. Ultimately, if the company can't fulfill its legal obligations to repay debt, shareholders could walk away with nothing. However, a more frequent (bu