Core Viewpoint - MercadoLibre reported impressive fourth-quarter results for 2024, leading to a significant increase in its stock price, reflecting strong performance despite economic challenges in Argentina [1][4]. Financial Performance - Fourth-quarter revenue increased by 37% year over year, reaching $6.06 billion, with constant-currency sales soaring by 96% [2]. - Adjusted earnings per share nearly quadrupled to $12.61, surpassing Wall Street's expectations of $8.05 per share on revenue of approximately $5.79 billion [2]. Segment Performance - The company experienced robust sales growth across all reportable segments and markets, highlighted by a tripling of consolidated sales in Argentina when adjusted for currency and a 106% increase in its third-party marketplace segment [3]. Stock Performance - MercadoLibre's stock is approaching new all-time highs, recently breaking through a resistance level around $2,100 per share and now targeting the $2,300 mark [4]. - The stock is currently trading at a high valuation of 61 times updated earnings, justified by its strong growth amidst an economic crisis [5].

Core Insights - MercadoLibre (MELI) shares experienced a significant surge following the release of its fourth-quarter earnings, which exceeded market expectations [1][3] - The company reported a revenue of $6.06 billion for the fourth quarter, surpassing forecasts, while earnings per share reached $12.61, significantly higher than the projected $8.20 [1][3] Revenue Growth - Revenue growth was robust across key markets, with increases ranging from 31% to 43% in Mexico, Brazil, and Argentina compared to the same period last year [2][3] - Overall, the company's revenue grew by 37% year-over-year, achieving a quarterly record [2] Market Performance - Following the earnings report, shares of MercadoLibre rose by 8%, reaching an intraday record of $2,374.54 [3] - The earnings per share exceeded expectations by more than $4, indicating strong financial performance [3] User Engagement - The company noted record levels of retention and frequency on its marketplace, as well as increased payments and deposits per user in its digital account [2] - The number of merchants borrowing from MercadoLibre has also reached an all-time high, reflecting strong demand for its services [2]

Core Viewpoint - MercadoLibre is well-positioned for sustained high-quality growth over the next decade, despite being highly valued relative to its 2024 estimates, with a price multiple that does not fully reflect its potential [3][4]. Financial Performance - In Q4, MercadoLibre reported net revenue of $12.61 billion, representing a 37.4% year-over-year increase, exceeding consensus estimates by 200 basis points [6][8]. - The company experienced a 33% increase in total payment volume, a 24% increase in unique buyers, and an 8% gain in gross merchandise volume, with FX-neutral growth rates of 49% and 56% respectively [7]. - Adjusted earnings reached $12.61, up nearly 60% year-over-year, significantly surpassing consensus forecasts by more than $5.00 [8]. Market Position and Valuation - MercadoLibre trades at only 7x its 2033 forecasts, while peers like Amazon and Walmart trade at 15x to 21x their 2033 estimates, suggesting a potential stock price increase of 100% to 200% driven by price multiple expansion [5][4]. - The stock price forecast for the next 12 months is $2,320.31, indicating a 2.23% upside based on 17 analyst ratings, with a high forecast of $3,000.00 [10]. Growth Strategy - The company plans to continue expanding its capacity in 2025, showing clear momentum with solid double-digit growth across its primary markets [9]. - Despite not returning significant capital to shareholders through dividends or buybacks, MercadoLibre is self-funding its growth and has a strong balance sheet [11]. Analyst Sentiment - Analysts show a positive shift in sentiment for MercadoLibre, with increased coverage and a high conviction in the Buy rating, alongside upgrades and price target revisions [13].

Core Insights - Wall Street analysts have issued over 12,000 ratings on S&P 500 stocks, leading to a one-year target of 6,920 for the index, suggesting a potential gain of nearly 13% from the current level of 6,145 [1][2] Company Analysis: Microsoft - Microsoft has two primary growth engines: enterprise software and cloud computing, enhanced by AI features, although the stock has declined 9% in the last three months, presenting a potential investment opportunity [4][2] - Approximately 70% of Fortune 500 companies utilize Microsoft 365, with a 60% sequential increase in usage recently, indicating strong market penetration [5] - Azure, Microsoft's cloud platform, is well-positioned in the AI sector, with analysts noting its competitive edge over Amazon Web Services due to its partnership with OpenAI [6] - Earnings for Microsoft are expected to grow at 13% annually through fiscal 2026, with a current valuation of 33 times earnings, which is a discount to the 12-month average of 36 times earnings, suggesting a reasonable entry point for investors [7] - The average target price for Microsoft among 59 analysts is $510 per share, indicating a 23% upside from the current price of $415 [11] Company Analysis: MercadoLibre - MercadoLibre operates the largest online marketplace in Latin America, with a projected market share in retail e-commerce of 30% by 2026, up from 28% in 2024 [8] - The company boasts the fastest logistics network in Latin America and holds over 50% market share in retail media advertising, enhancing its attractiveness to merchants [9] - The ongoing digitization of the Latin American economy is expected to drive online retail sales growth at 10% annually through 2028, which will also benefit MercadoLibre's digital payments and advertising segments [10] - Wall Street anticipates earnings growth of 43% annually through 2025, with a current valuation of 73 times earnings appearing reasonable [11] - The average target price for MercadoLibre among 25 analysts is $2,300 per share, suggesting an 11% upside from the current price of $2,075 [11]

INVESTOR PRESENTATION Q4'24 Results February 20th, 2025 DISCLAIMERS Fourth Quarter 2024 This presentation may contain forward-looking statements including, but not limited to, statements regarding MercadoLibre, Inc.'s expectations, objectives and progress against strategic priorities; initiatives and strategies related to our products and services; business and market outlook, opportunities, strategies and trends; impacts of foreign exchange; the potential impact of the uncertain macroeconomic and geopoliti ...

Financial Data and Key Metrics Changes - In 2024, MercadoLibre achieved $21 billion in revenue and generated over $1 billion in free cash flow, demonstrating the ability to drive profitable growth while investing in long-term strategic objectives [13] - The company reported a 74% year-on-year increase in its credit portfolio, indicating strong growth in this segment [34] Business Line Data and Key Metrics Changes - The marketplace surpassed 100 million unique buyers and the fintech platform reached over 60 million monthly active users for the first time, reflecting significant user growth [9] - In Argentina, items sold grew by 18% in Q4, a recovery from a tough first half of the year, and the fintech credit book quadrupled year-on-year [39] Market Data and Key Metrics Changes - MercadoLibre's key top-line metrics, including GMV and acquiring TPV, outpaced the market in Brazil, Mexico, and Argentina, driving significant market share gains [8] - The company noted a 29% year-on-year increase in items shipped, contributing to improved logistics efficiency [18] Company Strategy and Development Direction - The long-term growth strategy is based on low e-commerce penetration in the region, the opportunity to offer better financial products, and the digitalization of cash [13] - Investments in logistics infrastructure and credit card offerings are central to the company's ambition of becoming the largest digital bank in Latin America [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future opportunities, particularly in Argentina, where economic recovery signals are strong [40] - The company remains cautious about credit issuance in Brazil due to rising interest rates but is comfortable with the current risk levels [30][32] Other Important Information - The company invested approximately $900 million in CapEx and $3 billion in its fintech business during 2024 [119] - The introduction of the MELI dollar, a stablecoin, and new investment options in Brazil, Mexico, Argentina, and Chile are part of the fintech expansion strategy [24] Q&A Session Summary Question: Credit portfolio risk appetite amid rising interest rates in Brazil - Management noted no signs of deterioration in the credit portfolio, with the lowest first payment default recorded in December [30] - Measures have been taken to reduce risk, including tightening payback periods and reducing micro card issuance [31][32] Question: Tailwinds and headwinds for margins in Argentina - Management is optimistic about Argentina's economic growth, with a strong recovery in item sales and a quadrupled credit book [39][40] - Long-term margin improvement is expected as the company continues to grow and capture market share [42] Question: Progress on opening new warehouses - The company opened two new warehouses in Q4 to support peak season demand and plans to continue expanding capacity [50] Question: Competition in low ASP items - Sales of low ticket items are growing at par or faster than the average, supported by improved user experience and features [51] Question: Measures to reduce credit risk in Brazil - Management is tightening payback periods and limiting card issuance to riskier segments to manage credit risk [57] Question: Trends in NIMAL and profitability of credit card book - NIMAL decreased year-on-year due to a higher share of credit cards, but profitability is improving as older cohorts mature [59][60] Question: Expectations for credit card investments and wallet funding - The company is being more restrictive in issuing cards to riskier segments while expanding limits for existing customers [66][69] Question: Impact of reducing micro cards on GMV growth - Management does not expect significant impact on GMV growth from reducing micro card issuance [72] Question: Advertising growth and future targets - The company is focused on building relationships with brands and expanding advertising inventory, with expectations for long-term growth [81][84] Question: Utilization levels of new fulfillment centers - The logistics network performed well in Q4, with productivity improvements aligning with demand [89] Question: Modeling provisions for future growth - Historical portfolios are performing better, but sequential growth in new portfolios may pressure provisions [92][94] Question: Drivers of e-commerce acceleration and user behavior - User behavior is changing positively, with growth in essentials and improved value propositions driving increased frequency of purchases [100]

Core Insights - MercadoLibre reported $6.06 billion in revenue for Q4 2024, a year-over-year increase of 42.2% [1] - The company's EPS for the same period was $12.61, up from $3.25 a year ago, indicating a significant growth [1] - Revenue exceeded the Zacks Consensus Estimate of $5.84 billion by 3.71%, while EPS surpassed the consensus estimate of $7.26 by 73.69% [1] Financial Performance Metrics - Gross merchandise volume was reported at $14.55 billion, slightly below the average estimate of $14.71 billion [4] - Total payment volume reached $58.91 billion, which was lower than the estimated $59.80 billion [4] - Geographic revenue from Argentina was $1.31 billion, exceeding the average estimate of $941.23 million [4] Stock Performance - Shares of MercadoLibre have returned +14.2% over the past month, outperforming the Zacks S&P 500 composite's +2.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Insights - MercadoLibre reported quarterly earnings of $12.61 per share, significantly exceeding the Zacks Consensus Estimate of $7.26 per share, and up from $3.25 per share a year ago [1] - The earnings surprise for this quarter was 73.69%, following a previous quarter where the company reported earnings of $7.83 against an expectation of $11.27, resulting in a surprise of -30.52% [2] - The company achieved revenues of $6.06 billion for the quarter, surpassing the Zacks Consensus Estimate by 3.71%, and up from $4.26 billion year-over-year [3] Earnings Performance - Over the last four quarters, MercadoLibre has exceeded consensus EPS estimates three times [2] - The company has also topped consensus revenue estimates in all four of the last quarters [3] Stock Performance - MercadoLibre shares have increased approximately 22.1% since the beginning of the year, outperforming the S&P 500's gain of 4.5% [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [7] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $6.86 on revenues of $5.39 billion, and for the current fiscal year, it is $43.96 on revenues of $25.24 billion [8] - The Internet - Commerce industry, to which MercadoLibre belongs, is currently ranked in the top 24% of over 250 Zacks industries, suggesting a favorable outlook [9]

Core Insights - MercadoLibre reported strong financial results for Q4 2024, with total revenue reaching $6.06 billion, a 37% increase year-over-year, and adjusted earnings per share soaring by 288% to $12.61, significantly exceeding expectations [2][3]. Financial Performance - Total revenue for Q4 2024 was $6.06 billion, up from $4.41 billion in Q4 2023, marking a 37% increase [2]. - Adjusted earnings per share rose to $12.61 from $3.25, reflecting a remarkable 288% growth [2]. - Gross merchandise volume increased by 8%, reaching $14.55 billion [2]. - Assets under management surged by 129%, exceeding $10 billion for the first time, totaling $10.58 billion [2]. Business Growth - Commerce-related revenue grew by 44% year-over-year, while fintech revenue increased by 29% [3]. - The number of unique active buyers rose to 67.3 million, a 24% increase from the previous year [4]. - Items sold on the MercadoLibre marketplace increased by 27%, and same-day and next-day shipments via Mercado Envios were up by 21% [4]. Market Reaction - Following the release of the financial results, MercadoLibre's stock price surged by over 13% in after-hours trading, indicating strong investor confidence [6]. Future Outlook - The company expressed optimism in its shareholder letter, anticipating continued growth and momentum into 2025 and beyond [5]. - Engagement on the marketplace and payment activity on the Mercado Pago network are at record levels, suggesting a robust operational environment [7]. - As geopolitical conditions evolve, MercadoLibre's dominance in the Latin American market is expected to strengthen, posing challenges for competitors [8].

Core Insights - MercadoLibre reported stronger-than-expected earnings for Q4 2024, with diluted earnings per share of $12.61, significantly surpassing the analyst estimate of $7.90 [1][3] - Revenue for the quarter reached $6.1 billion, exceeding expectations of $5.88 billion, reflecting robust growth in both e-commerce and fintech sectors [1][3] Financial Performance - EPS (Diluted) increased by 288% year-over-year from $3.25 to $12.61 [3] - Revenue grew by 37.4% year-over-year from $4.41 billion to $6.06 billion [3] - Net income reached $639 million, a 287% increase from $165 million in Q4 2023 [3] - Total payment volume rose to $58.9 billion, up 32.5% year-over-year from $44.5 billion [3] - Gross merchandise volume (GMV) increased by 8.2% year-over-year to $14.5 billion [3] E-commerce and Fintech Growth - The overall performance highlighted solid results across e-commerce and fintech divisions, despite regional challenges [2] - MercadoLibre's total payment volume surged due to strong growth in digital payment services, particularly in Brazil and Mexico [6] - The fintech arm, Mercado Pago, saw a 29% year-over-year increase in monthly active users, reaching 61.2 million, and the total credit portfolio expanded to $6.6 billion, a 74% increase year-over-year [8] Logistics and Operational Efficiency - Mercado Envios processed 1.79 billion items throughout 2024, with over half a billion items delivered in Q4 alone, marking a 27% year-over-year increase [7] - The proportion of same-day or next-day deliveries slightly decreased from 51% to 49%, indicating a need for further enhancements in logistics [7] Market Position and Future Outlook - MercadoLibre is a dominant force in Latin America's e-commerce market, operating across 18 countries and focusing on expanding digital payment solutions and logistics operations [4][5] - Management expressed optimism for 2025, emphasizing strategic investments to enhance e-commerce and fintech capabilities, while monitoring asset quality within credit operations [10][11]