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MercadoLibre Inc MELI

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Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Wide-Moat MercadoLibre’s High Growth Phase Continued in First Quarter; Shares Fully Valued

David Swartz Equity Analyst

Analyst Note

| David Swartz |

MercadoLibre achieved strong growth for both its e-commerce and financial services in 2021’s first quarter, keeping it on track to meet or exceed our volume, user, and revenue estimates for the year. Its revenue growth of 111% beat consensus’ 76% forecast and likely will lead us to raise our prior full-year estimate of 51%. Thus, we expect to increase our per share fair value estimate of $1,370 on the firm by a mid-single-digit percentage, although we view its shares as fully valued.

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Company Profile

Business Description

Founded in 1999, MercadoLibre's commerce segment (representing 64% of net revenue in 2020) includes online marketplaces in more than a dozen Latin American countries, display and paid search advertising capabilities (MercadoClics), online store management services (MercadoShops), and third-party logistics solutions (MercadoEnvios). Its fintech segment includes an online/offline payment-processing platform (MercadoPago), mobile wallet platform, credit solutions for buyers/sellers, and asset management offerings (Mercado Fondo). The company derives more than 95% of its revenue from Brazil, Argentina, and Mexico.

Contact
Pasaje Posta 4789, 6th Floor
Buenos Aires, C1430EKG
T +54 1146408000
Sector Consumer Cyclical
Industry Internet Retail
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 15,546

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