Looking for a No-Brainer Growth Stock? Look Here
Unless you’re retired and need to invest very conservatively, most investors want to have at least a few top growth stocks in their portfolios. There are no guarantees in the market, which is why diversification is so important. However, there are a few rare stocks that look like no-brainers. They’re demonstrating incredible growth, are already profitable, and have strong growth drivers.
MercadoLibre (MELI) fits that framework, and there are several reasons the investing thesis looks so compelling right now.
Trends are in its favor
Global e-commerce keeps growing as a percentage of global retail sales, but it’s not the same everywhere. Consider the countries with the fastest e-commerce growth.
IMAGE SOURCE: STATISTA.
Three out of the top five countries with the fastest-growing e-commerce sales rates are in Latin America. Not only that, but these are MercadoLibre’s three top regions, Mexico, Argentina, and Brazil, and they’re all well-ahead of global rates.
Argentina, which has historically been MercadoLibre’s primary growth market, saw negative year-over-year revenue growth in the 2024 first quarter due to high inflation. But gross merchandise volume (GMV) increased 43% year over year in Mexico and 36% in Brazil, outpacing the 2023 rates for these countries.
MercadoLibre continues to demonstrate outstanding growth, both in e-commerce and in its newer fintech business. Total GMV increased 20% year over year in the first quarter, or 71% currency neutral, with a 25% increase in items sold.
It operates in countries that are still getting started in e-commerce and digital services in general. That’s why its fintech segment, which started as a way for shoppers who didn’t have credit cards to pay for purchases, is growing by leaps and bounds. Total payment volume increased 35%, or 86% currency-neutral in the first quarter.
The part that most concerns investors is that there’s still so much more to expect as these countries continue to embrace and adopt e-commerce and digital payments. MercadoLibre is well-positioned to keep up its strong growth and create shareholder value.
This article was originally published on this site
