Two Growth Stocks: MercadoLibre and The Real Brokerage
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
0mins
Should l Buy MELI?
Source: Fool
- MercadoLibre Growth Acceleration: Despite a decline in profit margins from 16% to 11%, MercadoLibre achieved a 47% year-over-year revenue growth last quarter, indicating significant long-term potential in markets like Brazil and Mexico, with expectations for substantial business expansion over the next decade.
- Market Share Enhancement: By reinvesting in lower shipping thresholds and a stronger delivery network, MercadoLibre is actively addressing short-term profit pressures, which will provide lasting market momentum in the e-commerce and fintech sectors across Latin America.
- The Real Brokerage's Innovative Model: As a software brokerage platform, The Real Brokerage allows approximately 32,000 agents to manage their businesses virtually, generating around $2 billion in revenue last year with a 44% year-over-year growth, showcasing its immense growth potential in the U.S. real estate market.
- Future Growth Potential: With a market cap of just $569 million, The Real Brokerage is not yet profitable, but its asset-light model and plans to expand into mortgage underwriting and financial tools suggest a promising path toward healthy earnings and cash flow for shareholders.
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Analyst Views on MELI
Wall Street analysts forecast MELI stock price to rise
11 Analyst Rating
10 Buy
1 Hold
0 Sell
Strong Buy
Current: 1767.020
Low
2500
Averages
2783
High
2950
Current: 1767.020
Low
2500
Averages
2783
High
2950
About MELI
MercadoLibre Inc is a Uruguay-based e-commerce business facilitator of Argentinian origins. The e-commerce products enable retail and wholesale via Internet platforms designed to provide users with a portfolio of services to facilitate commercial transactions. The Company's geographic coverage includes 18 countries of Latin America. The primary offer is an ecosystem of six integrated e-commerce services: the Mercado Libre Marketplace, the Mercado Libre Classifieds service, the Mercado Pago payments solution, the Mercado Credito financial solutions, the Mercado Envios logistic solutions including shipping, the Mercado Ads advertising platform and the Mercado Shops digital storefront solution.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
MercadoLibre Reports High Growth Amid Profit Decline
- Significant Revenue Growth: MercadoLibre reported a 47% year-over-year revenue increase in Q4 2025 (currency neutral), indicating strong performance in its e-commerce and fintech sectors, although the market reacted negatively to declining profits, highlighting the company's long-term growth potential in Latin America.
- AI-Driven Ad Revenue: The company leveraged artificial intelligence to enhance marketing campaigns, resulting in a 67% increase in ad revenue, while 87% of interactions on the Mercado Pago digital wallet occur without human intervention, underscoring AI's critical role in improving operational efficiency and customer experience.
- Strong Performance in Brazil: Following a reduction in the free shipping threshold in Brazil, the e-commerce segment accelerated with a 35% year-over-year growth in gross merchandise volume and a 45% increase in items sold, indicating that the company's competitive advantage is strengthening as new buyers engage more across categories with higher retention rates.
- Stock Price Correction Offers Buying Opportunity: Despite lower operating and net profit margins in Q4, MercadoLibre's P/E ratio has dropped to 47, near a 10-year low, which, while not objectively low, presents an attractive entry point for high-growth stocks, making it a consideration for long-term investors.
See More
MercadoLibre Considers Selling Loan Portions to Support Fintech Growth
- Loan Portfolio Sale Plan: MercadoLibre's CEO indicated the possibility of selling parts of its loan book to find suitable funding tools, while stressing that there are no plans to sell core businesses or dismantle the fintech arm Mercado Pago, highlighting the company's strategy to seek robust funding support in a rapidly growing credit market.
- Credit Risk Concerns: MercadoLibre's shares fell earlier this year as investors grew cautious about the rapid growth of Mercado Pago's credit card business and rising investment costs, reflecting market worries about its financial health, especially after the company missed quarterly profit estimates.
- AI Implementation: The company is deploying generative artificial intelligence to improve credit decisions, enabling better customer assessments and more effective lending, which enhances the quality and growth potential of its credit portfolio, showcasing its strategic investment in technological innovation.
- Stable Venezuela Operations: Despite political upheaval, MercadoLibre's operations in Venezuela remain unchanged, with the CEO emphasizing that the e-commerce marketplace is functioning normally and that the company is not actively engaging in fintech services, indicating a cautious approach and ongoing focus in the region.
See More
MercadoLibre Stock Pullback Presents Investment Opportunity
- Significant Growth: MercadoLibre reported a remarkable 47% year-over-year revenue growth in Q4 2025, demonstrating strong market resilience and long-term growth potential despite global economic turmoil and inflationary pressures.
- AI-Driven Ad Revenue: The company leveraged artificial intelligence to enhance marketing campaigns, resulting in a 67% increase in ad revenue, while 87% of interactions on the Mercado Pago digital wallet occur without human intervention, improving operational efficiency and customer experience.
- Innovation in Brazil: Following a reduction in the free shipping threshold in Brazil, the e-commerce segment accelerated with a 35% year-over-year growth, as new buyers purchased more items across categories, indicating a positive cycle of long-term growth with higher customer retention rates.
- Attractive Valuation: Despite a decline in operating and net profit margins, MercadoLibre's P/E ratio has dropped to 47, near a 10-year low, with the current stock price at $1791.99, presenting a compelling entry point for long-term investors.
See More
Analysis of Three Undervalued Stocks
- Duolingo User Growth: Duolingo reported 52.3 million monthly active users at the start of the year, a 30% increase year-over-year, yet its stock is trading 81% below its 52-week high, indicating market caution regarding its growth prospects.
- Revenue Growth Deceleration: Despite a 35% revenue increase in Q4, Duolingo anticipates a slowdown in overall revenue growth to 15%-18% for 2026, which could negatively impact its profitability and market confidence.
- MercadoLibre Market Challenges: Trading at $1,841.12 with a P/E ratio of 27, MercadoLibre continues to grow but faces pressure from increased competition and has missed profit targets for three consecutive quarters, dampening market sentiment.
- Carnival Stock Performance: Carnival's stock is priced at $26.77 with a P/E of 12; despite rising fuel costs, it has exceeded earnings expectations for 11 consecutive quarters, indicating strong future growth potential.
See More
RWC Asset Advisors Fully Exits MercadoLibre Holdings
- Full Liquidation: RWC Asset Advisors fully exited its MercadoLibre position in Q1 2026, selling 24,608 shares for an estimated $47.47 million, reflecting a cautious outlook on the market.
- Asset Management Shift: This transaction reduced MercadoLibre's share in RWC's assets from 9.4% to 0%, indicating a significant portfolio adjustment that may impact future investment strategies.
- Stock Price Volatility: As of April 26, 2026, MercadoLibre shares were priced at $1,835.22, down 16.8% year-over-year and underperforming the S&P 500 by 47.4 percentage points, raising concerns about its long-term growth potential.
- Revenue Growth Potential: Despite declining margins, MercadoLibre reported a 45% revenue growth in the latest quarter, which may attract growth-seeking investors who view the recent stock dip as a buying opportunity.
See More
RWC Asset Advisors Fully Exits MercadoLibre Position
- Complete Exit: RWC Asset Advisors fully liquidated its position in MercadoLibre by selling 24,608 shares in Q1 2026 for an estimated $47.47 million, marking a significant exit as the stock previously constituted 9.4% of its assets under management.
- Decline in Asset Value: The sale resulted in a $49.57 million decrease in the fund's quarter-end position value, highlighting the substantial impact of trading and stock price fluctuations on asset management, indicating a waning confidence in MercadoLibre.
- Poor Stock Performance: As of April 26, 2026, MercadoLibre shares were priced at $1,835.22, down 16.8% over the past year, significantly underperforming the S&P 500 by 47.4 percentage points, reflecting a decline in its competitive position in the market.
- Investor Considerations: Despite a robust 45% revenue growth in the most recent quarter, the operating margin has shrunk from 16% to around 11%, prompting investors to carefully assess the long-term investment value of MercadoLibre, especially following RWC's complete exit.
See More
MercadoLibre Reports High Growth Amid Profit Decline
- Significant Revenue Growth: MercadoLibre reported a 47% year-over-year revenue increase in Q4 2025 (currency neutral), indicating strong performance in its e-commerce and fintech sectors, although the market reacted negatively to declining profits, highlighting the company's long-term growth potential in Latin America.
- AI-Driven Ad Revenue: The company leveraged artificial intelligence to enhance marketing campaigns, resulting in a 67% increase in ad revenue, while 87% of interactions on the Mercado Pago digital wallet occur without human intervention, underscoring AI's critical role in improving operational efficiency and customer experience.
- Strong Performance in Brazil: Following a reduction in the free shipping threshold in Brazil, the e-commerce segment accelerated with a 35% year-over-year growth in gross merchandise volume and a 45% increase in items sold, indicating that the company's competitive advantage is strengthening as new buyers engage more across categories with higher retention rates.
- Stock Price Correction Offers Buying Opportunity: Despite lower operating and net profit margins in Q4, MercadoLibre's P/E ratio has dropped to 47, near a 10-year low, which, while not objectively low, presents an attractive entry point for high-growth stocks, making it a consideration for long-term investors.
See More
MercadoLibre Considers Selling Loan Portions to Support Fintech Growth
- Loan Portfolio Sale Plan: MercadoLibre's CEO indicated the possibility of selling parts of its loan book to find suitable funding tools, while stressing that there are no plans to sell core businesses or dismantle the fintech arm Mercado Pago, highlighting the company's strategy to seek robust funding support in a rapidly growing credit market.
- Credit Risk Concerns: MercadoLibre's shares fell earlier this year as investors grew cautious about the rapid growth of Mercado Pago's credit card business and rising investment costs, reflecting market worries about its financial health, especially after the company missed quarterly profit estimates.
- AI Implementation: The company is deploying generative artificial intelligence to improve credit decisions, enabling better customer assessments and more effective lending, which enhances the quality and growth potential of its credit portfolio, showcasing its strategic investment in technological innovation.
- Stable Venezuela Operations: Despite political upheaval, MercadoLibre's operations in Venezuela remain unchanged, with the CEO emphasizing that the e-commerce marketplace is functioning normally and that the company is not actively engaging in fintech services, indicating a cautious approach and ongoing focus in the region.
See More
MercadoLibre Stock Pullback Presents Investment Opportunity
- Significant Growth: MercadoLibre reported a remarkable 47% year-over-year revenue growth in Q4 2025, demonstrating strong market resilience and long-term growth potential despite global economic turmoil and inflationary pressures.
- AI-Driven Ad Revenue: The company leveraged artificial intelligence to enhance marketing campaigns, resulting in a 67% increase in ad revenue, while 87% of interactions on the Mercado Pago digital wallet occur without human intervention, improving operational efficiency and customer experience.
- Innovation in Brazil: Following a reduction in the free shipping threshold in Brazil, the e-commerce segment accelerated with a 35% year-over-year growth, as new buyers purchased more items across categories, indicating a positive cycle of long-term growth with higher customer retention rates.
- Attractive Valuation: Despite a decline in operating and net profit margins, MercadoLibre's P/E ratio has dropped to 47, near a 10-year low, with the current stock price at $1791.99, presenting a compelling entry point for long-term investors.
See More
Analysis of Three Undervalued Stocks
- Duolingo User Growth: Duolingo reported 52.3 million monthly active users at the start of the year, a 30% increase year-over-year, yet its stock is trading 81% below its 52-week high, indicating market caution regarding its growth prospects.
- Revenue Growth Deceleration: Despite a 35% revenue increase in Q4, Duolingo anticipates a slowdown in overall revenue growth to 15%-18% for 2026, which could negatively impact its profitability and market confidence.
- MercadoLibre Market Challenges: Trading at $1,841.12 with a P/E ratio of 27, MercadoLibre continues to grow but faces pressure from increased competition and has missed profit targets for three consecutive quarters, dampening market sentiment.
- Carnival Stock Performance: Carnival's stock is priced at $26.77 with a P/E of 12; despite rising fuel costs, it has exceeded earnings expectations for 11 consecutive quarters, indicating strong future growth potential.
See More
RWC Asset Advisors Fully Exits MercadoLibre Holdings
- Full Liquidation: RWC Asset Advisors fully exited its MercadoLibre position in Q1 2026, selling 24,608 shares for an estimated $47.47 million, reflecting a cautious outlook on the market.
- Asset Management Shift: This transaction reduced MercadoLibre's share in RWC's assets from 9.4% to 0%, indicating a significant portfolio adjustment that may impact future investment strategies.
- Stock Price Volatility: As of April 26, 2026, MercadoLibre shares were priced at $1,835.22, down 16.8% year-over-year and underperforming the S&P 500 by 47.4 percentage points, raising concerns about its long-term growth potential.
- Revenue Growth Potential: Despite declining margins, MercadoLibre reported a 45% revenue growth in the latest quarter, which may attract growth-seeking investors who view the recent stock dip as a buying opportunity.
See More
RWC Asset Advisors Fully Exits MercadoLibre Position
- Complete Exit: RWC Asset Advisors fully liquidated its position in MercadoLibre by selling 24,608 shares in Q1 2026 for an estimated $47.47 million, marking a significant exit as the stock previously constituted 9.4% of its assets under management.
- Decline in Asset Value: The sale resulted in a $49.57 million decrease in the fund's quarter-end position value, highlighting the substantial impact of trading and stock price fluctuations on asset management, indicating a waning confidence in MercadoLibre.
- Poor Stock Performance: As of April 26, 2026, MercadoLibre shares were priced at $1,835.22, down 16.8% over the past year, significantly underperforming the S&P 500 by 47.4 percentage points, reflecting a decline in its competitive position in the market.
- Investor Considerations: Despite a robust 45% revenue growth in the most recent quarter, the operating margin has shrunk from 16% to around 11%, prompting investors to carefully assess the long-term investment value of MercadoLibre, especially following RWC's complete exit.
See More
