MERCADOLIBRE INC (MELI) Stock Fundamental Analysis
NASDAQ:MELI - Nasdaq - US58733R1023 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to MELI. MELI was compared to 32 industry peers in the Broadline Retail industry. While MELI belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. MELI is not overvalued while it is showing excellent growth. This is an interesting combination. With these ratings, MELI could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
In the past year MELI was profitable.
MELI had a positive operating cash flow in the past year.
In multiple years MELI reported negative net income over the last 5 years.
In the past 5 years MELI always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 6.35%, MELI is doing good in the industry, outperforming 70.97% of the companies in the same industry.
Looking at the Return On Equity, with a value of 35.91%, MELI belongs to the top of the industry, outperforming 90.32% of the companies in the same industry.
With an excellent Return On Invested Capital value of 15.45%, MELI belongs to the best of the industry, outperforming 87.10% of the companies in the same industry.
MELI had an Average Return On Invested Capital over the past 3 years of 12.44%. This is in line with the industry average of 11.22%.
The last Return On Invested Capital (15.45%) for MELI is above the 3 year average (12.44%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.35% | ||
| ROE | 35.91% | ||
| ROIC | 15.45% |
ROA(3y)3.31%
ROA(5y)1.26%
ROE(3y)21.31%
ROE(5y)11.12%
ROIC(3y)12.44%
ROIC(5y)N/A
1.3 Margins
MELI's Profit Margin of 7.57% is fine compared to the rest of the industry. MELI outperforms 74.19% of its industry peers.
Looking at the Operating Margin, with a value of 10.81%, MELI is in the better half of the industry, outperforming 77.42% of the companies in the same industry.
In the last couple of years the Operating Margin of MELI has grown nicely.
MELI's Gross Margin of 46.28% is fine compared to the rest of the industry. MELI outperforms 64.52% of its industry peers.
MELI's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.81% | ||
| PM (TTM) | 7.57% | ||
| GM | 46.28% |
OM growth 3Y57.54%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5%
GM growth 5Y0.57%
2. Health
2.1 Basic Checks
MELI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for MELI has been increased compared to 1 year ago.
Compared to 5 years ago, MELI has more shares outstanding
The debt/assets ratio for MELI has been reduced compared to a year ago.
2.2 Solvency
MELI has an Altman-Z score of 4.61. This indicates that MELI is financially healthy and has little risk of bankruptcy at the moment.
MELI has a better Altman-Z score (4.61) than 74.19% of its industry peers.
MELI has a debt to FCF ratio of 0.87. This is a very positive value and a sign of high solvency as it would only need 0.87 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.87, MELI belongs to the best of the industry, outperforming 80.65% of the companies in the same industry.
MELI has a Debt/Equity ratio of 0.78. This is a neutral value indicating MELI is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.78, MELI is doing worse than 64.52% of the companies in the same industry.
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 | 0.78 | ||
| Debt/FCF | 0.87 | ||
| Altman-Z | 4.61 |
ROIC/WACC1.68
WACC9.18%
2.3 Liquidity
A Current Ratio of 1.25 indicates that MELI should not have too much problems paying its short term obligations.
MELI's Current ratio of 1.25 is in line compared to the rest of the industry. MELI outperforms 45.16% of its industry peers.
MELI has a Quick Ratio of 1.22. 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 of 1.22. This is comparable to the rest of the industry: MELI outperforms 58.06% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.25 | ||
| Quick Ratio | 1.22 |
3. Growth
3.1 Past
MELI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 45.04%, which is quite impressive.
Looking at the last year, MELI shows a very strong growth in Revenue. The Revenue has grown by 40.24%.
Measured over the past years, MELI shows a very strong growth in Revenue. The Revenue has been growing by 58.65% on average per year.
EPS 1Y (TTM)45.04%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%9.36%
Revenue 1Y (TTM)40.24%
Revenue growth 3Y53.87%
Revenue growth 5Y58.65%
Sales Q2Q%41.28%
3.2 Future
MELI is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 38.08% yearly.
The Revenue is expected to grow by 25.20% on average over the next years. This is a very strong growth
EPS Next Y75.96%
EPS Next 2Y53.88%
EPS Next 3Y47.68%
EPS Next 5Y38.08%
Revenue Next Year43.81%
Revenue Next 2Y32.89%
Revenue Next 3Y29.08%
Revenue Next 5Y25.2%
3.3 Evolution
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
The Price/Earnings ratio is 69.29, which means the current valuation is very expensive for MELI.
MELI's Price/Earnings ratio is a bit more expensive when compared to the industry. MELI is more expensive than 61.29% of the companies in the same industry.
When comparing the Price/Earnings ratio of MELI to the average of the S&P500 Index (28.28), we can say MELI is valued expensively.
Based on the Price/Forward Earnings ratio of 42.44, the valuation of MELI can be described as expensive.
Based on the Price/Forward Earnings ratio, MELI is valued a bit more expensive than 61.29% of the companies in the same industry.
MELI is valuated cheaply when we compare the Price/Forward Earnings ratio to 91.29, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.29 | ||
| Fwd PE | 42.44 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MELI indicates a slightly more expensive valuation: MELI is more expensive than 64.52% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, MELI is valued a bit cheaper than 67.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.09 | ||
| EV/EBITDA | 33.94 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent 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 47.68% in the coming years.
PEG (NY)0.91
PEG (5Y)N/A
EPS Next 2Y53.88%
EPS Next 3Y47.68%
5. Dividend
5.1 Amount
No dividends for MELI!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
MERCADOLIBRE INC
NASDAQ:MELI (1/30/2025, 11:41:01 AM)
1963.7
+73.94 (+3.91%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners85.17%
Inst Owner Change-2.1%
Ins Owners0.09%
Ins Owner Change0%
Market Cap99.56B
Analysts83.7
Price Target2366.31 (20.5%)
Short Float %1.48%
Short Ratio1.44
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.41%
Min EPS beat(2)-23.22%
Max EPS beat(2)20.39%
EPS beat(4)2
Avg EPS beat(4)-11.88%
Min EPS beat(4)-54.99%
Max EPS beat(4)20.39%
EPS beat(8)6
Avg EPS beat(8)5.37%
EPS beat(12)8
Avg EPS beat(12)-8.5%
EPS beat(16)10
Avg EPS beat(16)-388.08%
Revenue beat(2)1
Avg Revenue beat(2)2.57%
Min Revenue beat(2)-1.12%
Max Revenue beat(2)6.26%
Revenue beat(4)3
Avg Revenue beat(4)4.2%
Min Revenue beat(4)-1.12%
Max Revenue beat(4)10.34%
Revenue beat(8)6
Avg Revenue beat(8)3.13%
Revenue beat(12)9
Avg Revenue beat(12)3.25%
Revenue beat(16)12
Avg Revenue beat(16)4.71%
PT rev (1m)0.77%
PT rev (3m)1.79%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-9.16%
EPS NY rev (1m)0%
EPS NY rev (3m)-6.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)14.4%
Revenue NY rev (1m)0.9%
Revenue NY rev (3m)2.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.29 | ||
| Fwd PE | 42.44 | ||
| P/S | 5.25 | ||
| P/FCF | 16.09 | ||
| P/OCF | 14.38 | ||
| P/B | 24.88 | ||
| P/tB | 26.15 | ||
| EV/EBITDA | 33.94 |
EPS(TTM)28.34
EY1.44%
EPS(NY)46.27
Fwd EY2.36%
FCF(TTM)122.03
FCFY6.21%
OCF(TTM)136.53
OCFY6.95%
SpS374.34
BVpS78.93
TBVpS75.09
PEG (NY)0.91
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.35% | ||
| ROE | 35.91% | ||
| ROCE | 24.68% | ||
| ROIC | 15.45% | ||
| ROICexc | 78.4% | ||
| ROICexgc | 89.01% | ||
| OM | 10.81% | ||
| PM (TTM) | 7.57% | ||
| GM | 46.28% | ||
| FCFM | 32.6% |
ROA(3y)3.31%
ROA(5y)1.26%
ROE(3y)21.31%
ROE(5y)11.12%
ROIC(3y)12.44%
ROIC(5y)N/A
ROICexc(3y)156.06%
ROICexc(5y)N/A
ROICexgc(3y)373.98%
ROICexgc(5y)N/A
ROCE(3y)19.88%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y57.54%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5%
GM growth 5Y0.57%
F-Score5
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 0.87 | ||
| Debt/EBITDA | 1.17 | ||
| Cap/Depr | 122.5% | ||
| Cap/Sales | 3.87% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 261.11% | ||
| Profit Quality | 430.55% | ||
| Current Ratio | 1.25 | ||
| Quick Ratio | 1.22 | ||
| Altman-Z | 4.61 |
F-Score5
WACC9.18%
ROIC/WACC1.68
Cap/Depr(3y)169.65%
Cap/Depr(5y)186.21%
Cap/Sales(3y)5.49%
Cap/Sales(5y)5.73%
Profit Quality(3y)471.02%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)45.04%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%9.36%
EPS Next Y75.96%
EPS Next 2Y53.88%
EPS Next 3Y47.68%
EPS Next 5Y38.08%
Revenue 1Y (TTM)40.24%
Revenue growth 3Y53.87%
Revenue growth 5Y58.65%
Sales Q2Q%41.28%
Revenue Next Year43.81%
Revenue Next 2Y32.89%
Revenue Next 3Y29.08%
Revenue Next 5Y25.2%
EBIT growth 1Y-4.25%
EBIT growth 3Y142.4%
EBIT growth 5YN/A
EBIT Next Year36.14%
EBIT Next 3Y33.88%
EBIT Next 5Y31.23%
FCF growth 1Y286.67%
FCF growth 3Y70.43%
FCF growth 5Y103.38%
OCF growth 1Y229.82%
OCF growth 3Y63.2%
OCF growth 5Y86%