Mercado Libre Stock Price Forecast: MELI Near $1,741 as 45% Revenue Surge Clashes With Margin Fears

Mercado Libre Stock (NASDAQ:MELI): High-Growth Franchise On Sale Below Its Own History

Mercado Libre stock (NASDAQ:MELI) (real-time chart) trades around $1,741 today, about 1.5% lower on the session and more than 25% below its Q2 2025 peak near $2,600+. At this level the company carries a market cap of roughly $88 billion, a trailing P/E of 42.6x and no dividend, with the share price sitting not far above the 52-week low at $1,665 and well under the $2,645 high. While global indices and many large-cap tech names print record highs, MELI has lagged, pulled down by a visible downtrend and margin worries despite extremely strong fundamentals.

Top Line Still Firing: 45% Revenue Growth, $8.8 Billion Quarter

Latest reported quarter: revenue reached $8.8 billion, up 45% year-on-year in USD and 47% in constant currency, beating consensus by roughly $300 million. That growth rate accelerated versus roughly 39% in the prior quarter and about 35% a year earlier, which is exceptional for a platform of this size. Engagement metrics confirm this is not just price inflation:
unique active buyers crossed 80 million, with 16 million net new buyers added in the quarter, the largest cohort addition in company history.
Gross Merchandise Volume (GMV) rose 37%, units sold climbed 43%, and items per buyer advanced 15%, helped by aggressive incentives across shipping, subscriptions, advertising, credit cards and deposits.
In Brazil, forex-neutral GMV grew about 35%, and cross-border trade GMV jumped 74%, underscoring both the depth of core markets and the runway in newer cross-border corridors.

Profitability: EPS Down 12.5% as Growth Investments Compress Margins

Despite the top-line strength, earnings per share dipped. GAAP EPS printed $11.03, below the roughly $11.44 that the street expected and down 12.5% year-on-year. Operating income fell about 4%, and the operating margin landed around 9% of revenue, approximately 80 bps lower than a year earlier once one-off tax effects are stripped out.
Drivers of this pressure: heavier growth investment, lower interest income and a tougher tax-rate comparison even after a sizeable Brazilian tax credit. Management is deliberately pushing on free-shipping thresholds, deepening logistics coverage, expanding first-party assortment and stepping harder on credit and fintech penetration. That mix pushes COGS and opex up now, but it clearly supports the expansion of the ecosystem and raises the long-term competitive barrier.

Fintech Engine: 42% TPV Growth, 78% AUM Expansion, 90% Credit Growth

The fintech arm continues to scale at high speed. Active fintech users reached 77.9 million, up 27% year-on-year. Assets under management grew 78% to roughly $18.8 billion, while the credit portfolio surged 90% to $12.5 billion. Total Payment Volume (TPV) increased 42%, and acquiring TPV grew about 25% in Brazil and 50% in Mexico, illustrating the depth of the payments franchise on and off platform.
The crucial datapoint is that Net Interest Margin after losses is rising. That tells you the credit engine is scaling with discipline: risk pricing, underwriting, and collections on more mature Brazilian cohorts are improving, even as originations grow. Short-duration exposure gives MELI room to adjust quickly if macro conditions turn, but there is no question that the company is assuming larger balance-sheet risk in exchange for a very profitable, data-rich moat.

Logistics, First-Party and Engagement: Moat Widening, Unit Costs Falling

Logistics remains a core strategic asset. In Brazil, unit shipping costs declined about 11% in the quarter, even as the company cut free-shipping thresholds to pull in more demand and expand category coverage. That combination is difficult to replicate: more volume, better service, lower cost per parcel.
First-party (1P) sales are still a smaller slice of GMV but growing extremely fast, with currency-neutral GMV up roughly 80% in 2025, particularly in staples and supermarket categories. 1P fills assortment and price gaps when third-party supply is thin, improves customer experience, and deepens data on demand patterns.
Engagement continues to climb: more items per buyer, broader category penetration, and higher frequency across commerce and fintech all feed a network effect that makes it harder for competitors to dislodge Mercado Libre stock (NASDAQ:MELI) in its core geographies.

AI and Agentic Commerce: Data Scale Turns Into Product Edge

Management is leaning into AI across the platform. In ecommerce, MELI is using AI to enhance search, recommendations and discovery. In Argentina, search has already been reworked with AI-driven insights, complemented by an interactive assistant that guides users through key product attributes and refines queries on the fly.
Advertising is another beneficiary. AI is improving bidding, targeting and automated tools, supporting 67% year-on-year growth in the ads business as more merchants shift budget onto the marketplace.
On the fintech side, the Mercado Pago AI assistant now resolves about 87% of interactions with no human intervention, cutting service costs and improving user satisfaction. Mercado Pago currently leads Net Promoter Score rankings in Brazil, Mexico, Argentina and Chile, a clear signal that service levels are resonating.
There is a perceived risk that agentic AI could bypass marketplaces by routing orders directly. Management’s stance is straightforward: ecommerce is far more than search. Inventory depth, logistics reliability, pricing, financing, fraud control, customer support and trust still depend on a large, integrated platform. If AI accelerates the shift from offline to online, Mercado Libre is positioned to monetize both on-platform transactions and off-platform demand via advertising and data, given its unique transaction graph across commerce and payments.

Balance Sheet Strength: $6.7 Billion Liquidity, 1.2x Net Leverage, Solid FCF

Growth is being funded from a reasonably strong financial base. Liquidity (cash plus investments) stands around $6.7 billion, with net debt running at about 1.2x adjusted EBITDA. Adjusted free cash flow is roughly $1.5 billion despite heavy capex and rapid credit portfolio expansion, and free cash flow per share is on track to trend toward around $200 over the next few years if current trajectories hold.
Capital is being deployed into logistics productivity, in-store acquiring and broader Mercado Pago scaling. That mix suppresses near-term free cash flow margin, but it underpins long-duration growth and reinforces the network effect advantage across Latin American ecommerce and fintech.

Street Expectations: 50%+ EPS Growth in 2026, High-Teens Revenue Longer Term

Consensus expects EPS growth north of 50% in FY 2026, followed by solid double-digit gains extending toward FY 2028. Revenue growth is projected to cool from roughly 29.5% this year into the high-teens over the outer years as the base effects accumulate, but still well above most large-cap peers.
Despite that, earnings revisions have tilted negative in the last three months: about 10 downward EPS revisions vs. 3 upgrades, reflecting concern over margin compression, capex intensity, credit risk and a volatile macro backdrop in Latin America.
Ratings context matters: fundamental analysts as a group mark MELI as a Buy to Strong Buy, while systematic factor models see it closer to a Hold, given valuation, volatility and technical trends. That divergence is exactly what creates the spread between intrinsic value and the current quote.

Valuation: Sub-1 PEG, Depressed EV/Sales vs. History

On today’s price near $1,741, Mercado Libre stock (NASDAQ:MELI) trades at roughly 42.6x trailing earnings but under 30x forward earnings if you assume around $65 in normalized forward 12-month EPS. On that framework, a 45x multiple on $65 produces a value near $2,925 per share, implying more than 50% upside from current levels if execution stays on course.
The growth-adjusted metrics are even starker. The implied PEG ratio is below 1, unusually cheap for a platform compounding revenue above 25% with EPS growth guided above 50% in the near term. Enterprise value to revenue sits around 3.7x, versus a historical “normal” closer to 10x for MELI under less dislocated conditions; that is roughly a 60% discount to its own long-term average.
On cash-flow and earnings power: the stock changes hands at about 25x EBITDA and 15x free cash flow, levels that would be typical for mature, slower-growth software or internet franchises, not for a company still delivering mid-40s revenue growth and expanding its ecosystem aggressively across two massive addressable markets (commerce and fintech).
Viewed against that backdrop, the current valuation embeds substantial skepticism that margin pressure will ease or that growth will remain this strong. If margins stabilize in the low-teens and top-line growth settles above 20%, the present multiples leave room for material re-rating.

Technical Picture: Downtrend, Falling 200-Day Average, $1,700 Support

Technically, the chart is the weak link in the MELI story. The share price has been locked in a series of lower highs and lower lows since the post-pandemic surge, and the long-term 200-day moving average has rolled over and is now sloping down, signalling that bears still control the primary trend.
Momentum confirms that tone: the RSI has been oscillating in a soft band between roughly 30 and 65, consistent with a market where rallies fade and dips do not yet trigger strong trend reversals. The stock has also broken below the multi-year uptrend line that had held since Q2 2022, a key psychological level.
The most important zone on the downside sits around $1,700, where MELI carved out lows in late 2024 and again in April 2025, with considerable volume traded in that region. That price area is a logical place for medium-term buyers to step in and will be watched closely. On the upside, resistance is clustered along the upper edge of the current downtrend channel and around the 200-day moving average; reclaiming that band would be an early sign that the market is willing to pay up again for growth.
The most recent earnings reaction illustrates how fragile sentiment still is: the options market had priced an earnings move of about 8.8% (via the nearest at-the-money straddle with implied volatility near 51.9%), and MELI delivered roughly a 10% post-print drop, its first negative earnings reaction since November 2024. Medium-term positioning into the next catalyst—provisionally Q1 2026 results around May 7 after the close—will depend heavily on whether support near $1,700 continues to hold.

Macro, Competition and Regulatory Risk: Latin America Still Carries a Higher Beta

The structural thesis is attractive, but the risk envelope is not trivial. MELI operates across emerging markets where macro volatility, currency swings and regulatory shifts are a constant. Slower economic growth in core countries such as Brazil or Mexico, or renewed inflation bouts, can hit discretionary spending, payments volumes and credit quality simultaneously.
The credit book at $12.5 billion and growing at 90% per year is a powerful earnings driver but also a clear macro transmission channel. A deterioration in employment or household balance sheets could push delinquencies higher, potentially forcing tighter underwriting, slower growth and heavier provisions.
Competitive intensity remains elevated. Global players like Amazon, as well as fast-growing Asian entrants such as Temu and Shein, are active in Latin America, pushing on price and selection. The fact that MELI is growing GMV in Brazil at 35%, cross-border trade at 74% and 1P GMV at 80% shows that it is more than holding its ground, but the sector leaves no room for complacency.
On top of that, there is always the risk of tighter regulation targeting fintech spreads, data usage, cross-border flows or marketplace practices. Those headwinds would not be unique to Mercado Libre, but the company’s scale makes it a likely focal point in any policy discussion.

Governance, Insider Activity and Monitoring Points

Given the scale and growth profile of Mercado Libre stock (NASDAQ:MELI), alignment between management and shareholders is critical. Monitoring management share purchases, option exercises and sales via the insider transactions dashboard on the TradingNews.com stock profile, alongside the broader MELI stock profile, is essential to gauge confidence and any shifts in internal risk perception.
Key checkpoints over the next 12–24 months: whether operating margins stabilize back into the low-double-digit range as logistics and credit scale; the trajectory of Net Interest Margin after losses as the credit portfolio grows; the persistence of 25–30%+ revenue growth; and the market’s willingness to reward that profile with higher EV/sales and P/E multiples once technical pressure eases.

Stance on Mercado Libre Stock (NASDAQ:MELI): Buy, Fundamentally Bullish With Technical Volatility

Putting the pieces together, MELI is a rare case where fundamentals, growth runway and valuation are aligned in favour of the long-side, while the chart still looks uncomfortable. At around $1,741, with revenue growing 45%, EPS expected to expand 50%+ in 2026, an EV/sales ratio around 3.7x versus a historic 10x, and a fundamental value framework pointing to roughly $2,900 per share, the equity is priced as if those engines are about to stall.
The underlying business points in the opposite direction: 80 million buyers, GMV up 37%, TPV up 42%, AUM up 78%, credit up 90%, logistics unit costs down 11%, AI-driven product improvements across commerce and payments, and a balance sheet that can support investment.
From a professional equity-research perspective, the setup supports a Buy rating on Mercado Libre stock (NASDAQ:MELI) and a bullish long-term view, with the understanding that near-term price action remains hostage to a weak technical trend and Latin America’s higher macro beta.

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