MELI vs. JD: Which International E-Commerce Stock Has More Upside?

Core Insights - MercadoLibre (MELI) and JD.com (JD) are leading e-commerce companies in Latin America and China respectively, known for their logistics, user experience, and digital innovation [1][2] Group 1: Performance and Growth - MELI is capitalizing on increasing Internet penetration in Latin America, solidifying its position as the preferred online shopping destination [3] - In Q1 2025, MELI's brand preference scores reached all-time highs in Brazil, Mexico, Argentina, and Chile, with unique active buyers growing 25% year over year [4] - JD.com reported a 15% year-over-year increase in general merchandise revenues in Q1 2025, driven by strong performance in supermarkets and fashion [7] - JD's user engagement has improved due to investments in customer experience, leading to increased shopping frequency and average revenue per user [8] Group 2: Strategic Focus - MELI's focus on enhancing user experience through features like repeat purchases and better navigation has led to a 65% year-over-year growth in its supermarket category [5] - JD's commitment to low prices and an expanding third-party marketplace has strengthened user engagement and order volume [7] Group 3: Logistics and Cost Efficiency - MELI's logistics network is a key growth driver, achieving over 60% fulfillment penetration in Brazil, which lowers per-order costs and supports strategic investments [6] - JD Logistics reported an 11% revenue growth but faced operating income challenges due to investments in fulfillment upgrades [10] Group 4: Stock Performance and Valuation - Year-to-date, MELI's stock surged 53.1%, while JD's shares fell 6.5%, reflecting contrasting market sentiments [11][12] - MELI's forward 12-month P/S ratio is 4.37X, significantly higher than JD's 0.28X, indicating stronger investor confidence in MELI's growth potential [15] - The Zacks Consensus Estimate for MELI's 2025 earnings is $48.72 per share, reflecting a 29.27% year-over-year increase, while JD's estimate is $3.81 per share, indicating a 10.56% decline [18][19] Group 5: Conclusion - MELI is positioned as a more compelling international e-commerce investment due to favorable macro trends, rising Internet penetration, and strong execution, while JD's growth is hindered by rising costs in unproven areas [20]