Okay babe, let’s talk about the “Amazon of Latin America” and why this dip has me doing some serious window shopping 👀
MercadoLibre (MELI) reports third-quarter earnings on Wednesday, and honestly? The stock could use a win. Shares took a hit last week during a broader rout in Brazilian stocks after Luiz Inácio Lula da Silva won reelection as Brazil’s president — an outcome that caught a lot of investors off guard. Add that to the fact that the stock is already down 16% year-to-date because profits have slipped thanks to rising competition and heavy investments in the business, and you’ve got a stock that’s feeling a little unloved right now.
So the big question: will MELI rise or fall after Wednesday’s report? Let’s break it down like I would over coffee with one of my coaching girls. ☕
What to Expect When MercadoLibre Reports
Here’s the thing about MercadoLibre — it doesn’t give guidance. That means investors walk into every earnings report basically blindfolded, which is why this stock tends to make big moves after reporting. If you own it (or you’re watching it), buckle up.
The analyst consensus expects revenue to grow 44.6% to $10.7 billion, with earnings per share climbing from $8.32 to $9.27. Sounds great, right? But here’s the catch — those numbers tell us margins are still expected to narrow. Translation: the company is making more money, but keeping less of it.
The number everyone will be side-eyeing is operating margin. The market is nervous about MercadoLibre’s investment cycle, and honestly, I get it. The company is pouring money into logistics operations after lowering its free shipping threshold to stay competitive against players like Amazon and Sea Limited’s Shopee, who are trying to steal market share. On top of that, it’s investing heavily in its credit card business — and that comes with upfront marketing and onboarding costs, plus an accounting adjustment for expected future credit losses before any of that revenue actually shows up. It’s like paying for a whole wardrobe before you’ve worn a single outfit. 🛍️
Here’s what I’d remind my clients though: in Q2, management said the credit book “continues to be very profitable,” and pointed to the company’s strong cash generation, robust profitability, and healthy balance sheet as reasons to keep investing at this pace. Expect a similar message this quarter. This is why I tell my coaching clients to look past the quarterly noise and watch what management is actually building — spending today for market share tomorrow is often how winners are made.
Why MELI Could Jump After the Report
Now for the fun part. After falling 16% this year, there’s a real argument this stock is a bargain. Even the post-election sell-off felt like an overreaction to me — the company has done just fine with Lula in charge, rattling off an unmatched streak of 30 straight quarters of 30% or better revenue growth. Thirty quarters! That’s seven-plus years of consistent growth, babe. That doesn’t happen by accident.
There’s also a sneaky advantage here: with everyone anxious about AI stocks right now, MercadoLibre offers something rare — a tech-forward growth stock that isn’t directly exposed to the AI hype cycle. Diversification girlies, take note. 📊
And those investments everyone’s worried about? They have a track record of paying off. That’s literally why the company has grown revenue 30% or better every quarter for 30 quarters. It’s expanding into new markets across Latin America, growing its credit business, and the core e-commerce and fintech engines keep delivering strong results.
One honest caveat — and I always keep it real with you — it’s not clear exactly when the margin turnaround happens. Investors may have to wait until 2027. That requires patience, and not everyone has it.
Here’s What I’d Do
At this point, MercadoLibre is well into “buy” range territory. And if Wednesday’s report triggers another sell-off because investors are still frustrated about margins? That’s not a reason to panic — that’s a discount tag on a quality company, and long-term investors should treat it like one.
This is exactly the mindset I teach: don’t chase hype, don’t fear red days. Buy great businesses when they’re on sale, hold them while they compound, and let your money work harder than you do. 💅
If you want more no-fluff takes on stocks like this — and how to actually build wealth without the intimidation factor — come hang out with me. DM me your biggest investing question, or join my mailing list so you never miss a money moment. Your future rich self will thank you. ✨
