MERCADOLIBRE INC (MELI) Stock Fundamental Analysis
NASDAQ:MELI - Nasdaq - US58733R1023 - Common Stock - Currency: USD
MELI gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 28 industry peers in the Broadline Retail industry. MELI gets an excellent profitability rating and is at the same time showing great financial health properties. MELI is growing strongly while it is still valued neutral. This is a good combination! With these ratings, MELI could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
In the past year MELI was profitable.
In the past year MELI had a positive cash flow from operations.
Of the past 5 years MELI 4 years were profitable.
Each year in the past 5 years MELI had a positive operating cash flow.
1.2 Ratios
MELI's Return On Assets of 7.45% is fine compared to the rest of the industry. MELI outperforms 75.00% of its industry peers.
Looking at the Return On Equity, with a value of 41.19%, MELI belongs to the top of the industry, outperforming 96.43% of the companies in the same industry.
MELI has a Return On Invested Capital of 21.15%. This is amongst the best in the industry. MELI outperforms 92.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for MELI is significantly above the industry average of 11.59%.
The 3 year average ROIC (18.86%) for MELI is below the current ROIC(21.15%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 41.19% | ||
| ROIC | 21.15% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)34.15%
ROE(5y)21.57%
ROIC(3y)18.86%
ROIC(5y)13.44%
1.3 Margins
With an excellent Profit Margin value of 9.21%, MELI belongs to the best of the industry, outperforming 82.14% of the companies in the same industry.
In the last couple of years the Profit Margin of MELI has grown nicely.
Looking at the Operating Margin, with a value of 12.81%, MELI belongs to the top of the industry, outperforming 82.14% of the companies in the same industry.
MELI's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 46.13%, MELI is doing good in the industry, outperforming 64.29% of the companies in the same industry.
In the last couple of years the Gross Margin of MELI has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.81% | ||
| PM (TTM) | 9.21% | ||
| GM | 46.13% |
OM growth 3Y25.83%
OM growth 5YN/A
PM growth 3Y98.37%
PM growth 5YN/A
GM growth 3Y2.74%
GM growth 5Y-0.81%
2. Health
2.1 Basic Checks
MELI has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, MELI has about the same amount of shares outstanding.
Compared to 5 years ago, MELI has more shares outstanding
Compared to 1 year ago, MELI has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.71 indicates that MELI is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.71, MELI is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
The Debt to FCF ratio of MELI is 1.00, which is an excellent value as it means it would take MELI, only 1.00 years of fcf income to pay off all of its debts.
MELI has a Debt to FCF ratio of 1.00. This is amongst the best in the industry. MELI outperforms 82.14% of its industry peers.
A Debt/Equity ratio of 0.57 indicates that MELI is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.57, MELI is not doing good in the industry: 64.29% of the companies in the same industry are doing better.
Even though the debt/equity ratio score it not favorable for MELI, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1 | ||
| Altman-Z | 4.71 |
ROIC/WACC2.45
WACC8.65%
2.3 Liquidity
MELI has a Current Ratio of 1.20. This is a normal value and indicates that MELI is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of MELI (1.20) is worse than 71.43% of its industry peers.
A Quick Ratio of 1.18 indicates that MELI should not have too much problems paying its short term obligations.
MELI's Quick ratio of 1.18 is in line compared to the rest of the industry. MELI outperforms 53.57% of its industry peers.
The current and quick ratio evaluation for MELI is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 81.92% over the past year.
MELI shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 172.65% yearly.
MELI shows a strong growth in Revenue. In the last year, the Revenue has grown by 37.68%.
The Revenue has been growing by 55.35% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)81.92%
EPS 3Y172.65%
EPS 5YN/A
EPS Q2Q%43.66%
Revenue 1Y (TTM)37.68%
Revenue growth 3Y43.24%
Revenue growth 5Y55.35%
Sales Q2Q%36.97%
3.2 Future
MELI is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 31.77% yearly.
MELI is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 20.91% yearly.
EPS Next Y34.07%
EPS Next 2Y36.58%
EPS Next 3Y36.18%
EPS Next 5Y31.77%
Revenue Next Year32.92%
Revenue Next 2Y28.81%
Revenue Next 3Y26.3%
Revenue Next 5Y20.91%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
MELI is valuated quite expensively with a Price/Earnings ratio of 58.43.
Compared to the rest of the industry, the Price/Earnings ratio of MELI is on the same level as its industry peers.
MELI's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.82.
Based on the Price/Forward Earnings ratio of 33.78, the valuation of MELI can be described as expensive.
Based on the Price/Forward Earnings ratio, MELI is valued a bit more expensive than 60.71% of the companies in the same industry.
MELI is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 36.21, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.43 | ||
| Fwd PE | 33.78 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as MELI.
Based on the Price/Free Cash Flow ratio, MELI is valued a bit cheaper than 67.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.67 | ||
| EV/EBITDA | 32.46 |
4.3 Compensation for Growth
MELI's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
MELI has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as MELI's earnings are expected to grow with 36.18% in the coming years.
PEG (NY)1.72
PEG (5Y)N/A
EPS Next 2Y36.58%
EPS Next 3Y36.18%
5. Dividend
5.1 Amount
MELI does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
2375.92
+2.03 (+0.09%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryBroadline Retail
Earnings (Last)
Earnings (Next)
Inst Owners84.81%
Inst Owner Change-0.06%
Ins Owners0.26%
Ins Owner Change0%
Market Cap120.46B
Analysts82.76
Price Target2884.99 (21.43%)
Short Float %1.34%
Short Ratio1.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)35.43%
Min EPS beat(2)14.99%
Max EPS beat(2)55.87%
EPS beat(4)3
Avg EPS beat(4)17.01%
Min EPS beat(4)-23.22%
Max EPS beat(4)55.87%
EPS beat(8)6
Avg EPS beat(8)6.84%
EPS beat(12)10
Avg EPS beat(12)12.5%
EPS beat(16)12
Avg EPS beat(16)38.42%
Revenue beat(2)2
Avg Revenue beat(2)3.28%
Min Revenue beat(2)0.98%
Max Revenue beat(2)5.59%
Revenue beat(4)3
Avg Revenue beat(4)2.93%
Min Revenue beat(4)-1.12%
Max Revenue beat(4)6.26%
Revenue beat(8)7
Avg Revenue beat(8)3.52%
Revenue beat(12)10
Avg Revenue beat(12)3.33%
Revenue beat(16)13
Avg Revenue beat(16)4.02%
PT rev (1m)0.22%
PT rev (3m)12.69%
EPS NQ rev (1m)-3.05%
EPS NQ rev (3m)6.35%
EPS NY rev (1m)-0.25%
EPS NY rev (3m)5.4%
Revenue NQ rev (1m)0.46%
Revenue NQ rev (3m)6.82%
Revenue NY rev (1m)0.42%
Revenue NY rev (3m)5.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.43 | ||
| Fwd PE | 33.78 | ||
| P/S | 5.38 | ||
| P/FCF | 18.67 | ||
| P/OCF | 16.2 | ||
| P/B | 24.07 | ||
| P/tB | 25.32 | ||
| EV/EBITDA | 32.46 |
EPS(TTM)40.66
EY1.71%
EPS(NY)70.33
Fwd EY2.96%
FCF(TTM)127.28
FCFY5.36%
OCF(TTM)146.69
OCFY6.17%
SpS441.4
BVpS98.7
TBVpS93.83
PEG (NY)1.72
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 41.19% | ||
| ROCE | 29.8% | ||
| ROIC | 21.15% | ||
| ROICexc | 130.55% | ||
| ROICexgc | 155.15% | ||
| OM | 12.81% | ||
| PM (TTM) | 9.21% | ||
| GM | 46.13% | ||
| FCFM | 28.84% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)34.15%
ROE(5y)21.57%
ROIC(3y)18.86%
ROIC(5y)13.44%
ROICexc(3y)207.02%
ROICexc(5y)N/A
ROICexgc(3y)457.7%
ROICexgc(5y)N/A
ROCE(3y)26.57%
ROCE(5y)18.94%
ROICexcg growth 3Y46.42%
ROICexcg growth 5YN/A
ROICexc growth 3Y51.24%
ROICexc growth 5YN/A
OM growth 3Y25.83%
OM growth 5YN/A
PM growth 3Y98.37%
PM growth 5YN/A
GM growth 3Y2.74%
GM growth 5Y-0.81%
F-Score5
Asset Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1 | ||
| Debt/EBITDA | 0.82 | ||
| Cap/Depr | 154.96% | ||
| Cap/Sales | 4.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 212.43% | ||
| Profit Quality | 313.1% | ||
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.18 | ||
| Altman-Z | 4.71 |
F-Score5
WACC8.65%
ROIC/WACC2.45
Cap/Depr(3y)116.48%
Cap/Depr(5y)176.74%
Cap/Sales(3y)3.99%
Cap/Sales(5y)5.36%
Profit Quality(3y)451.37%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)81.92%
EPS 3Y172.65%
EPS 5YN/A
EPS Q2Q%43.66%
EPS Next Y34.07%
EPS Next 2Y36.58%
EPS Next 3Y36.18%
EPS Next 5Y31.77%
Revenue 1Y (TTM)37.68%
Revenue growth 3Y43.24%
Revenue growth 5Y55.35%
Sales Q2Q%36.97%
Revenue Next Year32.92%
Revenue Next 2Y28.81%
Revenue Next 3Y26.3%
Revenue Next 5Y20.91%
EBIT growth 1Y23.69%
EBIT growth 3Y80.24%
EBIT growth 5YN/A
EBIT Next Year76.57%
EBIT Next 3Y44.13%
EBIT Next 5Y34.95%
FCF growth 1Y78.01%
FCF growth 3Y170.77%
FCF growth 5Y86.33%
OCF growth 1Y84.45%
OCF growth 3Y101.69%
OCF growth 5Y77.37%