A Once-in-a-Decade Opportunity: 1 Supercharged Growth Stock to Buy After a Recent 10% Pullback

Core Viewpoint - MercadoLibre is positioned as a significant investment opportunity due to its substantial growth potential in the Latin American e-commerce and fintech sectors, despite recent stock price fluctuations [2][16]. Group 1: Company Growth and Market Potential - MercadoLibre's stock has increased over 6,560% since its IPO in 2007, with an initial investment of $15,000 now worth$1 million [1]. - The company has experienced a 33-fold revenue growth over the past decade, with the Latin American e-commerce market projected to grow by 50% in the next four to five years [4][5]. - The e-commerce penetration rate in Latin America is approximately 10 years behind that of the U.S., U.K., and China, indicating significant room for growth [4]. Group 2: Geographic Expansion - Currently, 96% of MercadoLibre's revenue comes from Brazil, Argentina, and Mexico, highlighting the potential for growth in other Latin American countries [7]. - Countries like Chile, Colombia, Peru, and Ecuador have a combined GDP similar to Mexico's but account for less than 5% of MercadoLibre's sales, indicating untapped markets [8][9]. Group 3: Financial Performance - MercadoLibre's return on invested capital (ROIC) has reached 18%, placing it in the top 20% of S&P 500 companies, suggesting strong profitability [10][12]. - The company's high ROIC is expected to persist as it continues to grow its high-margin advertising business and improve efficiencies through its logistics network [12]. Group 4: Valuation Metrics - MercadoLibre is currently trading at a price-to-sales (P/S) ratio of 5.3, which is less than half of its historical average, indicating a potentially attractive valuation [13]. - The company's earnings yield is at its highest consistent level since 2017, further supporting its valuation appeal [15].