MercadoLibre stock drops 23% due to missed earnings, but potential buying opportunity seen by some investors

From Nasdaq: 2024-11-17 08:00:00

MercadoLibre (NASDAQ: MELI) stock drops 23% after Q3 earnings report, sparking concerns. However, some investors, like Cathie Wood of ARK Invest, see a potential buying opportunity in the Latin American market leader. Founded in 1999 in Argentina, MercadoLibre dominates e-commerce and fintech across 18 countries, prioritizing growth over profitability.

Q3 FY2024 results show a 35% revenue increase to $5.3 billion, with net income below expectations due to aggressive investment in credit and logistics. Despite short-term margin pressure, MercadoLibre’s credit portfolio expansion and logistics investments position it for long-term success in Latin America’s booming online market.

Analysts remain bullish on MercadoLibre, rating it a Moderate Buy with an average price target of $2,349. While some caution against heavy spending impacting profitability, most see long-term potential in the company’s growth strategy and market dominance. Regulatory challenges, competition, and economic volatility pose risks.

Despite recent setbacks, MercadoLibre’s growth trajectory and market position make it an attractive investment opportunity in Latin America. The recent stock decline could be a chance for long-term investors to buy into a leading player in a rapidly expanding market. However, careful consideration of risks is advised before investing.



Read more at Nasdaq:: MercadoLibre Down 23% After Missed Earnings: Time to Buy the Dip?