MELI - MercadoLibre: LatAm's E-Commerce Juggernaut Ready To Rip Higher (Upgrade)

2024-04-08 11:45:23 ET

Summary

• MercadoLibre is LatAm's leading e-commerce company.
• The Company has benefited from LatAm's fast-growing e-commerce landscape and burgeoning fintech ecosystem.
• MELI suffered from near-term profitability uncertainties as it scaled up its first-party business and invested more aggressively in its logistics network.
• Despite that, MercadoLibre's expansion should underpin its network effects moat to outperform its smaller peers.
• With MELI consolidating well above the $1,460 level, I assessed it's getting ready to rip higher.

MercadoLibre, Inc. ( MELI ) is LatAm's leading e-commerce and fintech platform, with Brazil as its primary growth and profitability driver. The company has continued its bustling post-pandemic growth momentum, capitalizing on a largely untapped TAM, particularly in fintech. MercadoLibre has also successfully fended off incursions from Amazon ( AMZN ) over the years as it continued to gain market share. It has also defended its turf against Sea Limited's (SE) penetration. Notably, MercadoLibre's most significant e-commerce competitive advantages are predicated on the immense scale of its logistics and fulfillment network and its growing first-party or 1P ecosystem....

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