If you’ve been watching MercadoLibre (NasdaqGS:MELI) lately, the launch of its new business-to-business unit was hard to miss. By stepping beyond its consumer roots, MercadoLibre is now eyeing a share of the massive B2B e-commerce segment, a space many believe is where the next phase of digital commerce growth will come from. With over 4 million users already enabled for wholesale transactions, this expansion signals that MercadoLibre is not just looking to keep pace, but to lead a potentially transformative shift in how Latin American businesses buy and sell online.
This new initiative lands squarely in a year where MercadoLibre has been building strong momentum. Its stock has outperformed most of the market, up 39% year to date and 17% over the past twelve months. The company continues to post double-digit gains in revenue and user engagement, such as a 25% rise in daily active users, showing that growth is not just a headline, but a trend. While competition and shifting regulatory dynamics in key markets add complexity, the stock’s performance suggests that investor confidence remains high ahead of these strategic bets.
But with the shares running well ahead of the market this year, the question for investors is whether all this growth is already in the price or if MercadoLibre’s new direction opens a genuine buying opportunity from here.
The most widely followed view suggests MercadoLibre is trading below its calculated fair value, with analysts projecting significant upside if their assumptions play out.
Rapid expansion of MercadoPago’s user base and credit portfolio, supported by disciplined risk management and improvements in asset quality, positions the company to further capitalize on the increasing adoption of digital payments and financial services in the region. This is expected to drive growth in revenue and eventually net margin expansion.
Ever wondered what powers this bullish outlook? The narrative relies on bold future growth assumptions in multiple business lines and bets on margin improvements that could transform MercadoLibre’s earnings profile. Want to see what ambitious financial targets back up the dramatic price target jump? Discover the projections at the heart of the current valuation debate.
Result: Fair Value of $2,894 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, surging credit losses in volatile markets or intensifying competition could quickly undermine these bullish projections and put pressure on MercadoLibre’s long-term margins.
