Is MELI a good stock to buy? We came across a bullish thesis on MercadoLibre, Inc. on Compounding Your Wealth’s Substack by Sergey. In this article, we will summarize the bulls’ thesis on MELI. MercadoLibre, Inc.’s share was trading at $1,732.33 as of March 16th. MELI’s trailing and forward P/E were 43.97 and 25.77 respectively according to Yahoo Finance.
MercadoLibre, Inc. operates online commerce platforms in Brazil, Mexico, Argentina, and internationally. MELI continues to solidify its position as a dominant regional super-app, integrating commerce, payments, and credit across Latin America, while sustaining strong growth momentum with ~31.4% next-twelve-month revenue expansion. In Q3 2025, the company delivered 39% year-over-year revenue growth—its 27th consecutive quarter exceeding 30%—with operating income rising 30% to $724 million, reflecting ongoing operating leverage despite elevated reinvestment in logistics subsidies, credit expansion, and macro headwinds in Argentina.
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Commerce trends were particularly strong in Brazil, where lowering the free shipping threshold drove a sharp acceleration in items sold to 42% growth, supported by improved user engagement and purchasing behavior, while scale efficiencies reduced unit shipping costs by 8% sequentially. Mexico, Chile, and Colombia also contributed meaningfully, with accelerating GMV growth, declining fulfillment costs, and rising market share, while first-party sales surged 71% FX-neutral to address assortment gaps.
Fintech remains a core differentiator, as Mercado Pago continues to scale with rising monthly active users, strong customer satisfaction, and disciplined credit expansion, evidenced by historically low default rates and increasing profitability across maturing credit cohorts in Brazil.
Although Mexico and Argentina are earlier in their credit lifecycle and weigh on near-term margins, user growth remains robust, with total active buyers reaching approximately 75 million. Despite ongoing macroeconomic pressure in Argentina, management remains focused on long-term growth, with margins expected to expand as logistics efficiencies improve and fintech investments mature, reinforcing MELI’s compelling long-term investment case.
Previously, we covered a bullish thesis on MercadoLibre, Inc. (MELI) by Daan | InvestInsights in May 2025, which highlighted the company’s dominance in Latin America’s e-commerce and fintech markets, strong user growth, and long-term digital adoption tailwinds. MELI’s stock price has depreciated by approximately 32.98% since our coverage, driven by investor concerns over margin compression from aggressive reinvestment in logistics and fintech, along with macro risk in key markets, which together pressured near-term profitability expectations despite continued strong growth. Sergey shares a similar view but emphasizes on operating leverage, logistics efficiencies, and fintech credit maturity driving margin expansion.
