MercadoLibre (MELI) stock jumped 12% in after-hours trading as the company hit a milestone of over 100 million annual unique buyers on its platform. Its Q4 results showed strong double-digit growth in active buyers and items sold, along with continued expansion in its credit card business. As a result, its total payment volumes soared 33% to $58.9 billion. Interestingly, MercadoLibre is often called the Amazon (AMZN) and Alibaba (BABA) of Latin America, where it runs an e-commerce platform across 18 countries.
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MercadoLibre Beats Q4 Estimates
MercadoLibre reported adjusted earnings of $12.61 per share on $6.1 billion in revenue for Q4, beating analyst expectations of $7.90 per share and $5.8 billion in sales, according to FactSet.
Among its segments, its gross merchandise values (GMV) were up 8%, rising 28% in Mexico, 32% in Brazil, and an impressive 141% in Argentina. Meanwhile, MercadoLibre’s FinTech services saw strong growth, with monthly active users increasing by 34% to 61.2 million. Credit cards now make up the biggest share of its lending business, accounting for 40% of the total loan portfolio, up from 32% last year.
Looking ahead, MercadoLibre is confident about its future, capitalizing on the growing trend of online shopping in Latin America.
Barclays Stay Bullish on MELI Stock
Following its results, Barclays analyst Trevor Young hiked his price target from $2,200 to $2,500 on MELI stock while maintaining a Buy rating. Young’s new price target predicts an upside of 18.5% from the current levels.
Overall, analysts are bullish on MELI following Mexico’s 19% tariff on low-cost imports from non-free trade agreement countries, including China. They see the move as a positive, reducing competition from Asian retailers like PDD’s (PDD) Temu and Shein.
Is MercadoLibre Stock a Good Buy?
Analysts remain highly optimistic about MELI stock, with a Strong Buy consensus rating based on eight Buys and one Hold assigned in the last three months. The average price target for MELI is $2,233.3, suggesting an upside potential of 6% from its current price.
Year-to-date, MELI stock has gained 24%.
