AMZN - MercadoLibre: An Attractively Valued Alternative To E-Commerce Giant Amazon

2024-03-07 13:42:15 ET

Summary

• MercadoLibre's e-commerce leadership in Latin America is a perfect storm for growth. There are many reasons to suggest Latin America's e-commerce sector will grow exponentially in the next few years.
• MercadoLibre's three biggest markets - Brazil, Argentina and Mexico - have made stellar progress in the last decade in expanding Internet access, which works well for the company's growth plans.
• The rise of social commerce is another factor that would help MercadoLibre grow in the coming years. Recent stats suggest Latin America is the frontrunner in this market segment.
• MercadoLibre's expanding fulfillment network is another growth machine.
• MercadoLibre is taking a leaf out of Amazon's playbook, something investors should look at when comparing the “Fab 5” e-commerce giant.

Last May, I turned bullish on MercadoLibre ( MELI ) based on its growing scale, competitive advantages in key markets, the success of both its core and new products, and its international expansion plans. MELI stock is up around 20% since then. As attractive as that may sound, the S&P 500 has still beaten MELI stock since then, registering gains north of 23%....

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