Key Takeaways MELI's second-quarter 2025 net income margin dropped to 7.7% from 10.5% due to Argentina's FX losses.The Zacks Consensus Estimate pegs third-quarter 2025 Brazil revenues at $3.47B or 51% of total revenue.A 91% jump in MELI's $9.3B credit portfolio adds to downside risk amid volatile regional credit conditions.MercadoLibre’s (MELI) concentrated exposure to Latin American markets is expected to continue dragging on profitability as the company faces a constrained growth runway in volatile econom ...

Core Viewpoint - MercadoLibre is positioned as a leading investment opportunity in the Latin American e-commerce sector, comparable to Amazon in the region [1] Company Overview - Founded in 1999 in Argentina and headquartered in Uruguay, MercadoLibre is the e-commerce and fintech leader in Latin America, operating in 18 countries [2] - The company is the largest marketplace in Latin America, with Brazil contributing approximately 57% of its marketplace sales, alongside significant growth in Mexico and Argentina [2] Business Model - MercadoLibre operates online auction and buying/selling platforms similar to Amazon and eBay, and provides services for users to create online stores akin to Shopify [3] - The company offers delivery services, including next-day delivery, handling 90% of packages in its system [3] - It provides fintech solutions for payments, including digital accounts, insurance, and online classified listings, with its Mercato Pago unit enabling various financial transactions [5] Financial Performance - MercadoLibre has a market capitalization of about $123 billion, making it the second-largest company in the region by this metric [6] - The company reported nearly 71 million active buyers in Q2, a 25% increase year-over-year, and gross merchandise volume rose 37% when adjusted for currency fluctuations [8] - Revenue increased by 34% year-over-year to nearly $6.8 billion, with earnings per share slightly missing expectations due to investments in free shipping [9] Growth Potential - The Latin American e-commerce market is projected to grow at an average rate of almost 11% annually through 2033, driven by a population of nearly 670 million and a combined GDP of $7.3 trillion [10][11] - Analysts expect full-year 2025 revenue to rise 35% to $28.1 billion, with earnings per share increasing about 18% to $44.42 [9] - The stock has risen 40% so far in 2025, with future earnings growth estimates of 18% this year and 51% in 2026 [11]

巴西《经济价值报》9月1日报道，电商平台美客多（Mercado Livre） 通过其 Kangu 配送平台子公 司收购了 Memed 旗下药店Cuidamos Farma。Memed在巴西以数字处方平台闻名。美客多此次收购仍需 要巴西经济防御管理委员会（CADE）批准。此前，美客多公司曾研究在其电商平台推出非处方药品销 售相关战略。 （原标题：电商平台美客多进军巴西医药市场） ...

A month has gone by since the last earnings report for MercadoLibre (MELI) . Shares have lost about 1.2% in that time frame, underperforming the S&P 500.But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is MercadoLibre due for a breakout? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for MercadoLibre, Inc. before we dive into how investors and analysts have r ...

Core Viewpoint - MercadoLibre's (MELI) current P/E ratio of 42.7X indicates a significant premium compared to industry averages, suggesting unrealistic expectations that may threaten long-term sustainability [1][2] Market Performance and Financial Results - MELI's Q2 2025 revenues increased by 34% year-over-year to $6.8 billion, with gross merchandise volume up 21% and total payment volume rising 39% [4] - Operating margin contracted by 210 basis points to 12.2%, and net income margin decreased to 7.7%, indicating pressure from heavy subsidies and promotional spending [4] - Adjusted free cash flow was reported at $454 million, achieved only after $816 million in net fintech funding, highlighting the fragile nature of MELI's growth model [5] Competitive Landscape - Rising competition from Amazon, which is expanding its logistics network in Latin America, poses a significant threat to MELI's fulfillment advantage [6] - Sea Limited's Shopee platform in Brazil is attracting price-sensitive buyers, while eBay is gaining momentum in Latin America's cross-border trade, intensifying pressure on MELI [7][8] Geographic Concentration - MELI's reliance on Brazil, Argentina, and Mexico increases regional risks, with Q2 growth in Brazil achieved by lowering free shipping thresholds [10][11] - Argentina's currency volatility resulted in $117 million in foreign exchange losses, doubling year-over-year, impacting net income [11] - Mexico's fulfillment gains required aggressive financing concessions and deeper price cuts, exposing MELI to potential policy shifts and economic instability [12] Credit Expansion and Financial Stability - MELI's credit portfolio surged by 91% year-over-year to $9.3 billion, with non-performing loans over 90 days remaining elevated at 18.5% [13] - Net interest margin contracted to 23% from 31.1% a year ago, indicating deteriorating returns despite increased exposure [14] - The credit-fueled growth model appears unsustainable in the current volatile Latin American environment [14] Investment Thesis and Recommendation - The Zacks Consensus Estimate for Q3 2025 earnings is $9.88 per share, revised downward by 16.6%, reflecting weakening confidence in MELI's earnings trajectory [15] - MELI shares have declined by 4.6% over the past three months, underperforming the sector and industry growth [16] - The disconnect between expectations and fundamentals reinforces the view that MELI's premium valuation is unjustified at current levels [20]

Summary of Key Points from the Conference Call Industry Overview - The analysis focuses on the global equity market, particularly the performance and positioning of long-only funds across various sectors, including Semiconductors, Industrials, and Health Care [1][2][24]. Core Insights - **Equity Flow Trends**: Long-only funds globally purchased $27.2 billion in the Semiconductors sector, driven by positive sentiment towards AI, while they sold $42.3 billion in Industrials and $27.1 billion in Health Care [1]. - **Regional Activity**: Funds bought $21.0 billion in Asia Pacific excluding Japan, while selling $56.5 billion in the US [1]. - **Top Stock Movements**: In the US, NVIDIA saw a significant inflow of $16.9 billion, while Apple experienced an outflow of $11.2 billion. In Emerging Markets, TSMC gained $5.9 billion, and MercadoLibre lost $1.4 billion [2]. Crowded Stocks Analysis - **Crowded Positives**: Stocks with high ownership and positive momentum include Meta, Broadcom, Netflix, Visa, Mastercard, and Wells Fargo [3][4]. - **Crowded Negatives**: Stocks with high ownership but negative momentum include Meituan, LVMH, and Pilbara Minerals [3]. - **Under-owned Negatives**: Stocks like BHP, Targa Resources, and Lockheed Martin are under-owned but have potential upside [4]. Fund Ownership and Active Exposure - **Fund Ownership Metrics**: The report indicates that 73% of relevant funds own Stock B, highlighting the importance of fund ownership in investment decisions [28]. - **Active Exposure Analysis**: The analysis includes over 5,647 active long-only funds managing more than $29 trillion in equities, with a focus on their relative weight against benchmarks [18][19]. Performance Metrics - **Back-tested Performance**: Crowded Positive stocks have outperformed the global combined universe by 4.4% since January 2015, while Under-owned Negatives have consistently underperformed [73]. - **Equity Flow Calculation**: The report emphasizes the importance of equity flow in understanding fund behavior, with cumulative long-only equity flow for China stocks reaching $193.0 billion [27]. Methodology and Limitations - **Methodology**: The analysis combines fund ownership, active exposure, and Triple Momentum to identify investment opportunities and risks [36][63]. - **Limitations**: The report notes that the analysis does not include funds that do not declare holdings regularly or those with less than $500 million in AUM, which may skew results [72]. Conclusion - The report provides a comprehensive overview of fund flows, stock positioning, and performance metrics, highlighting significant trends in the equity market and identifying potential investment opportunities and risks across various sectors and regions.

巴西市场，未来可能有更多的竞争者入场。 五年前，当东南亚电商巨头Shopee决定进军巴西市场时，没有多少人预料到它能在美客多（Mercado Livre）的地盘上打开局面。如今，这个被视为"外来者"的平台已经成为巴西电商市场订单量的领跑 者。 日前，Shopee母公司Sea Limited公布了2025年第二季度业绩，其CEO Forrest Li特别强调了Shopee在巴西 市场的表现，他在财报会议上提到，Shopee已经成为巴西市场订单量第一的电商平台。 Shopee的优势主要在于其低价策略，数据显示，2024年，Shopee在巴西的销售额实现翻倍增长，达到约 600亿雷亚尔（约合103亿美元），是亚马逊收入的两倍，美客多的40%。 巴西目前通胀水平高企，年通胀仍维持在5.2%–5.5%的高位，而中低收入家庭数量庞大，大多数消费者 对价格敏感、购买力偏弱。Shopee瞄准价格敏感型用户群体，定位为低价平台，依靠小单高频，以价换 量迅速做大GMV，打开了巴西市场。 自2019年进入巴西以来，Shopee靠着全免邮、满减补贴和游戏化购物体验，快速积累了大量年轻和中低 收入用户，同时依靠低佣金吸引了大量卖家入驻 ...

Core Insights - Temu has become the highest traffic e-commerce platform in Brazil, surpassing Mercado Livre and Shopee with 409.7 million visits in July, a 70% increase from June [1] - The Brazilian e-commerce market is experiencing intense competition, with Temu and Shopee applying pressure through pricing and logistics, while short video platforms like Kwai Shop and TikTok are also challenging Mercado Livre's market position [1][5] - Mercado Livre announced a significant investment of 34 billion reais (approximately 6.4 billion USD) in its Brazilian operations by 2025, marking a 48% increase year-on-year [1] Group 1: Competition Dynamics - Shopee has emerged as Mercado Livre's strongest competitor, capturing 40% of Mercado Livre's GMV in just five years since entering the Brazilian market in 2020, with an estimated GMV of 60 billion reais by 2024 [2] - Shopee's competitive edge lies in its free shipping and frequent promotions, with average product prices about one-third of Mercado Livre's [2] - In response, Mercado Livre has reduced fees for products priced between 79 and 200 reais by approximately 40% and lowered the minimum purchase for free shipping from 79 to 19 reais, although this has negatively impacted its profit margins [2] Group 2: Logistics and Infrastructure - Brazil's logistics infrastructure is inadequate, ranking 65th globally according to the World Bank, which affects transportation efficiency [3] - Approximately 72% of Brazilian consumers consider free shipping a decisive factor in their shopping decisions [3] - Mercado Livre has expanded its warehouse space to 2.3 million square meters, a 50% increase in one year, while Shopee has also increased its warehouse space by 54% to 897,000 square meters [3] Group 3: Market Trends and New Entrants - The entry of TikTok Shop and Kwai Shop into the Brazilian market adds further competition, with TikTok having over 111 million users in Brazil [6][7] - TikTok Shop's potential to attract small and medium-sized enterprises could pose a threat to Mercado Livre, which primarily serves this segment [7] - The competition from short video platforms is expected to reshape the Brazilian e-commerce landscape, similar to trends observed in Southeast Asia [6][7]

Core Insights - MercadoLibre (NASDAQ: MELI) is one of the largest e-commerce players in Latin America, founded in 1999 and has experienced significant growth in recent years [1] Company Overview - The company is based in Argentina and has established itself as a major player in the Latin American e-commerce market [1] Growth and Performance - MercadoLibre has shown an impressive growth rate over the last several years, indicating strong market demand and operational success [1]

Core Viewpoint - True diversification in investment involves not only spreading investments across different industries but also across various countries and regions, as emphasized by macro investor Ray Dalio [1][2]. Group 1: Alibaba Group - Alibaba Group's stock has been underperforming since 2022, primarily due to its association with China, despite strong management performance [3][4]. - The company is increasingly recognized for its data center and cloud computing capabilities, which are expected to contribute significantly to its growth in Asia's emerging economies [4][5]. - Analysts have a consensus view of a Moderate Buy for Alibaba, with a price target of $159.7 per share, indicating a potential upside of 32.5% from current levels [6]. Group 2: Nu Holdings - Nu Holdings is a Brazilian financial platform catering to a growing middle class, similar to Robinhood in the U.S. [7]. - Institutional interest in Nu Holdings is rising, with State Street Corp increasing its holdings by 2.4%, now representing a net position of $1.25 billion [8][9]. - The consensus view for Nu Holdings is a Moderate Buy with a price target of $15.8 per share, while one analyst suggests an Outperform rating with a target of $18, indicating a potential upside of 36% [10]. Group 3: Mercado Libre - Mercado Libre is positioned as a key player in the Latin American market, akin to Amazon, benefiting from the region's middle-class growth [12]. - Analysts forecast earnings per share (EPS) of $13.79 for Q4 2025, a 33.7% increase from the current EPS of $10.31 [13]. - The stock trades at a premium P/E ratio of 57.8x, reflecting high market expectations for future growth compared to the industry average of 27.9x [14].