MercadoLibre Inc. Common Stock (MELI)

FairStock Score: 31/100 — RISKY

Key Financials

Strengths

• Strong Piotroski F-Score of 7/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• High return on equity of 36.0% demonstrating efficient capital deployment
• Revenue growth of 44.6% demonstrates strong top-line momentum
• Established organization with 1,23,670 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($344) with negative 428% margin of safety—limited downside protection

AI Analysis

MercadoLibre Inc. Common Stock is a large-cap consumer cyclical company valued at $92.0 billion. The business generates $28.9 billion in annual revenue with a 1.9% net margin. From a quality standpoint, MercadoLibre shows solid Piotroski F-Score of 7/9 and Altman Z-Score of 2.1 in the grey zone. On valuation, the stock is commanding a steep 45.9x multiple, with trades far above its Graham Number ($344) with no margin of safety. Growth dynamics show revenue growing at 44.6% and profit growth of -12.5%. Our composite FairStock Score of 31/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

MercadoLibre's 45% revenue growth trajectory could accelerate as it captures additional market share in the consumer cyclical sector. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

At 46x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer