MELI Should I Buy
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MercadoLibre Inc (MELI) is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's strong revenue growth, consistent investment in long-term growth opportunities, and recent analyst upgrades signal confidence in its future performance. Despite short-term margin compression, the company's strategic investments are expected to drive long-term shareholder value.
The MACD is positive and contracting, indicating bullish momentum. RSI is neutral at 60.648, suggesting no overbought or oversold conditions. The stock is trading above the pivot level of 1787.793, with resistance at 1867.025 and support at 1708.56. Overall, the technical indicators suggest a stable upward trend.
Pictet North America Advisors increased its stake in MercadoLibre, reflecting confidence in the company's growth.
The company is enhancing its delivery strategy to attract new customers and improve sales growth.
Analysts like Jefferies and Morgan Stanley have upgraded or maintained positive ratings, citing long-term growth potential.
Rising competition, especially in Brazil, as noted by JPMorgan.
Short-term margin compression due to increased investments, which has led to some analyst downgrades and reduced price targets.
In 2025/Q4, revenue increased by 44.56% YoY to $8.759 billion, showcasing strong growth. However, net income and EPS dropped by 12.52% and 12.46% YoY, respectively, due to higher investment spending. Gross margin also declined by 4.78% YoY to 43.2%. While profitability has been impacted, the revenue growth indicates the company's investments are driving top-line expansion.
Analysts are generally positive on the stock, with recent upgrades from Jefferies to 'Buy' and a price target of $2,600. However, some firms like JPMorgan have downgraded the stock to 'Neutral' due to competition and margin concerns. The consensus reflects confidence in long-term growth but acknowledges short-term challenges.
