Gublo
Small/Mid-Cap Trader, Multibagger/Penny Stocks, Earnings Analysis & Signals
MercadoLibre is a strong business worth owning long term, and its valuation has compressed even as earnings soared. Per a Blossom post, over five years revenue grew from $5.52 billion to $31.8 billion and EPS from -$0.03 to $37.88, while the price-to-sales ratio fell from 17.2x to 2.67x and the share price barely moved. x.comÂ
MercadoLibre's commerce and fintech revenue growth underpins the view that its shares are undervalued at current prices. The attached chart shows quarterly commerce services revenue reaching $4.3 billion and fintech revenue $4.4 billion in June 2026, up from $769 million and $467 million in March 2021. x.comÂ
MercadoLibre's growth under Lula makes today's selloff look absurd. On a TTM basis since Q1 2023, revenue is up 206% and EPS 200%; having done so well during his term, it should be fine going forward. x.com x.comÂ
MercadoLibre's collapsing margins and earnings make its 45-times-earnings valuation look like a value trap. It faces intense competition, and less of its revenue reaches the bottom line; falling earnings make the stock more expensive even as its price falls. Nu Holdings trades at 17 times earnings and Inter & Co at 7 times, with both growing revenue and earnings robustly. Selling MercadoLibre to build positions in companies with better fundamentals is under consideration. x.com x.com x.com x.comÂ
MercadoLibre makes a short list of favored stocks, alongside S&P Global. x.comÂ
MercadoLibre is cheap for a company with an unmatched growth record: 28 straight quarters of 30%+ revenue growth, something no other company has achieved. Yet the stock is almost flat over five years, trading at 29x forward earnings and 2.4x EV/sales. x.comÂ
Political uncertainty and Amazon competition have held MercadoLibre's stock back despite a humming business. The company is great and the stock deserves to turn, but at roughly 45 times earnings and only about 12% gained over five years, it has remained a difficult stock to own. x.com x.com x.com x.comÂ
MercadoLibre looks cheap for its projected growth. Revenue is estimated to rise from $28.89 billion in 2025 to $65.81 billion in 2028, a 32% annual rate, with EPS growing from $39.40 to $90.14, leaving the stock at 18.1x 2028 EPS. Forecasting revenue, margins and earnings that far out is not easy, though. x.comÂ
MercadoLibre is compounding faster than the market gives it credit for, trading at 30x forward earnings with 37% estimated 2027 EPS growth per @DimitryNakhla's list, below its growth rate on a PEG basis. FICO shows the same at 25x with 27% growth, part of a quality discount broader than most people realize. x.comÂ
South American political unpredictability keeps investors from rewarding MercadoLibre's excellent fundamentals. Today's selloff illustrates that risk, despite the strength of the business. x.com x.comÂ
MercadoLibre is worth owning for 20 years because its marketplace, payments, credit and advertising reinforce one another, with a long reinvestment runway in underpenetrated Latin American e-commerce and digital finance. Quarterly revenue grew 50% despite its scale, making about 40x earnings very reasonable for its quality. A deep management bench under CEO Ariel Szarfsztejn reduces founder dependence. Risks include credit underwriting, competition from Sea and Amazon, currencies and regulation. … Show more
