MERCADOLIBRE INC (MELI) Stock Fundamental Analysis
NASDAQ:MELI - Nasdaq - US58733R1023 - Common Stock - Currency: USD
Overall MELI gets a fundamental rating of 7 out of 10. We evaluated MELI against 28 industry peers in the Broadline Retail industry. MELI scores excellent points on both the profitability and health parts. This is a solid base for a good stock. MELI is not priced too expensively while it is growing strongly. Keep and eye on this one! With these ratings, MELI could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
MELI had positive earnings in the past year.
MELI had a positive operating cash flow in the past year.
MELI had positive earnings in 4 of the past 5 years.
Each year in the past 5 years MELI had a positive operating cash flow.
1.2 Ratios
MELI has a Return On Assets of 7.45%. This is in the better half of the industry: MELI outperforms 75.00% of its industry peers.
With an excellent Return On Equity value of 41.19%, MELI belongs to the best of the industry, outperforming 96.43% of the companies in the same industry.
The Return On Invested Capital of MELI (21.15%) is better than 92.86% of its industry peers.
MELI had an Average Return On Invested Capital over the past 3 years of 18.86%. This is significantly above the industry average of 11.59%.
The 3 year average ROIC (18.86%) for MELI is below the current ROIC(21.15%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 41.19% | ||
| ROIC | 21.15% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)34.15%
ROE(5y)21.57%
ROIC(3y)18.86%
ROIC(5y)13.44%
1.3 Margins
With an excellent Profit Margin value of 9.21%, MELI belongs to the best of the industry, outperforming 82.14% of the companies in the same industry.
In the last couple of years the Profit Margin of MELI has grown nicely.
The Operating Margin of MELI (12.81%) is better than 82.14% of its industry peers.
In the last couple of years the Operating Margin of MELI has grown nicely.
The Gross Margin of MELI (46.13%) is better than 64.29% of its industry peers.
In the last couple of years the Gross Margin of MELI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.81% | ||
| PM (TTM) | 9.21% | ||
| GM | 46.13% |
OM growth 3Y25.83%
OM growth 5YN/A
PM growth 3Y98.37%
PM growth 5YN/A
GM growth 3Y2.74%
GM growth 5Y-0.81%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MELI is creating value.
MELI has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, MELI has more shares outstanding
Compared to 1 year ago, MELI has an improved debt to assets ratio.
2.2 Solvency
MELI has an Altman-Z score of 4.68. This indicates that MELI is financially healthy and has little risk of bankruptcy at the moment.
MELI has a better Altman-Z score (4.68) than 71.43% of its industry peers.
MELI has a debt to FCF ratio of 1.00. This is a very positive value and a sign of high solvency as it would only need 1.00 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.00, MELI belongs to the best of the industry, outperforming 82.14% of the companies in the same industry.
A Debt/Equity ratio of 0.57 indicates that MELI is somewhat dependend on debt financing.
MELI's Debt to Equity ratio of 0.57 is on the low side compared to the rest of the industry. MELI is outperformed by 64.29% of its industry peers.
Even though the debt/equity ratio score it not favorable for MELI, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1 | ||
| Altman-Z | 4.68 |
ROIC/WACC2.3
WACC9.2%
2.3 Liquidity
A Current Ratio of 1.20 indicates that MELI should not have too much problems paying its short term obligations.
MELI has a worse Current ratio (1.20) than 71.43% of its industry peers.
MELI has a Quick Ratio of 1.18. This is a normal value and indicates that MELI is financially healthy and should not expect problems in meeting its short term obligations.
MELI has a Quick ratio (1.18) which is in line with its industry peers.
MELI does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 81.92% over the past year.
Measured over the past years, MELI shows a very strong growth in Earnings Per Share. The EPS has been growing by 172.65% on average per year.
MELI shows a strong growth in Revenue. In the last year, the Revenue has grown by 37.68%.
MELI shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 55.35% yearly.
EPS 1Y (TTM)81.92%
EPS 3Y172.65%
EPS 5YN/A
EPS Q2Q%43.66%
Revenue 1Y (TTM)37.68%
Revenue growth 3Y43.24%
Revenue growth 5Y55.35%
Sales Q2Q%36.97%
3.2 Future
MELI is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.77% yearly.
MELI is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 20.91% yearly.
EPS Next Y34.07%
EPS Next 2Y36.58%
EPS Next 3Y36.18%
EPS Next 5Y31.77%
Revenue Next Year32.66%
Revenue Next 2Y28.71%
Revenue Next 3Y26.29%
Revenue Next 5Y20.91%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 59.36 indicates a quite expensive valuation of MELI.
The rest of the industry has a similar Price/Earnings ratio as MELI.
MELI's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.50.
The Price/Forward Earnings ratio is 34.32, which means the current valuation is very expensive for MELI.
60.71% of the companies in the same industry are cheaper than MELI, based on the Price/Forward Earnings ratio.
MELI is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 59.36 | ||
| Fwd PE | 34.32 |
4.2 Price Multiples
MELI's Enterprise Value to EBITDA ratio is in line with the industry average.
MELI's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. MELI is cheaper than 64.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.96 | ||
| EV/EBITDA | 32.13 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of MELI may justify a higher PE ratio.
A more expensive valuation may be justified as MELI's earnings are expected to grow with 36.18% in the coming years.
PEG (NY)1.74
PEG (5Y)N/A
EPS Next 2Y36.58%
EPS Next 3Y36.18%
5. Dividend
5.1 Amount
MELI does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
2413.57
+62.43 (+2.66%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners84.81%
Inst Owner Change0%
Ins Owners0.26%
Ins Owner Change0%
Market Cap122.37B
Analysts82.76
Price Target2878.73 (19.27%)
Short Float %1.48%
Short Ratio1.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)35.43%
Min EPS beat(2)14.99%
Max EPS beat(2)55.87%
EPS beat(4)3
Avg EPS beat(4)17.01%
Min EPS beat(4)-23.22%
Max EPS beat(4)55.87%
EPS beat(8)6
Avg EPS beat(8)6.84%
EPS beat(12)10
Avg EPS beat(12)12.5%
EPS beat(16)12
Avg EPS beat(16)38.42%
Revenue beat(2)2
Avg Revenue beat(2)3.28%
Min Revenue beat(2)0.98%
Max Revenue beat(2)5.59%
Revenue beat(4)3
Avg Revenue beat(4)2.93%
Min Revenue beat(4)-1.12%
Max Revenue beat(4)6.26%
Revenue beat(8)7
Avg Revenue beat(8)3.52%
Revenue beat(12)10
Avg Revenue beat(12)3.33%
Revenue beat(16)13
Avg Revenue beat(16)4.02%
PT rev (1m)2.05%
PT rev (3m)10.64%
EPS NQ rev (1m)-1.32%
EPS NQ rev (3m)8.25%
EPS NY rev (1m)1.41%
EPS NY rev (3m)4.52%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)6.38%
Revenue NY rev (1m)1.62%
Revenue NY rev (3m)5.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 59.36 | ||
| Fwd PE | 34.32 | ||
| P/S | 5.47 | ||
| P/FCF | 18.96 | ||
| P/OCF | 16.45 | ||
| P/B | 24.45 | ||
| P/tB | 25.72 | ||
| EV/EBITDA | 32.13 |
EPS(TTM)40.66
EY1.68%
EPS(NY)70.33
Fwd EY2.91%
FCF(TTM)127.28
FCFY5.27%
OCF(TTM)146.69
OCFY6.08%
SpS441.4
BVpS98.7
TBVpS93.83
PEG (NY)1.74
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 41.19% | ||
| ROCE | 29.8% | ||
| ROIC | 21.15% | ||
| ROICexc | 130.55% | ||
| ROICexgc | 155.15% | ||
| OM | 12.81% | ||
| PM (TTM) | 9.21% | ||
| GM | 46.13% | ||
| FCFM | 28.84% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)34.15%
ROE(5y)21.57%
ROIC(3y)18.86%
ROIC(5y)13.44%
ROICexc(3y)207.02%
ROICexc(5y)N/A
ROICexgc(3y)457.7%
ROICexgc(5y)N/A
ROCE(3y)26.57%
ROCE(5y)18.94%
ROICexcg growth 3Y46.42%
ROICexcg growth 5YN/A
ROICexc growth 3Y51.24%
ROICexc growth 5YN/A
OM growth 3Y25.83%
OM growth 5YN/A
PM growth 3Y98.37%
PM growth 5YN/A
GM growth 3Y2.74%
GM growth 5Y-0.81%
F-Score5
Asset Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1 | ||
| Debt/EBITDA | 0.82 | ||
| Cap/Depr | 154.96% | ||
| Cap/Sales | 4.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 212.43% | ||
| Profit Quality | 313.1% | ||
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.18 | ||
| Altman-Z | 4.68 |
F-Score5
WACC9.2%
ROIC/WACC2.3
Cap/Depr(3y)116.48%
Cap/Depr(5y)176.74%
Cap/Sales(3y)3.99%
Cap/Sales(5y)5.36%
Profit Quality(3y)451.37%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)81.92%
EPS 3Y172.65%
EPS 5YN/A
EPS Q2Q%43.66%
EPS Next Y34.07%
EPS Next 2Y36.58%
EPS Next 3Y36.18%
EPS Next 5Y31.77%
Revenue 1Y (TTM)37.68%
Revenue growth 3Y43.24%
Revenue growth 5Y55.35%
Sales Q2Q%36.97%
Revenue Next Year32.66%
Revenue Next 2Y28.71%
Revenue Next 3Y26.29%
Revenue Next 5Y20.91%
EBIT growth 1Y23.69%
EBIT growth 3Y80.24%
EBIT growth 5YN/A
EBIT Next Year76.57%
EBIT Next 3Y44.13%
EBIT Next 5Y34.95%
FCF growth 1Y78.01%
FCF growth 3Y170.77%
FCF growth 5Y86.33%
OCF growth 1Y84.45%
OCF growth 3Y101.69%
OCF growth 5Y77.37%