We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is MercadoLibre (MELI) Up 31.7% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for MercadoLibre (MELI - Free Report) . Shares have added about 31.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MercadoLibre due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Mercadolibre Reports Loss in Q4
MercadoLibre reported a fourth-quarter 2021 loss of 92 cents per share against the Zacks Consensus Estimate for earnings of 89 cents. The figure compares favorably with the year-ago loss of $1.02 per share. Notably, the company reported earnings per share of $1.92 in the prior quarter.
Its revenues surged 60.5% on a year-over-year basis (73.9% on an FX-neutral basis) to $2.13 billion. The figure increased 14.7% sequentially. The top line surpassed the Zacks Consensus Estimate of $2 billion.
Revenues were driven by accelerating commerce and fintech revenues, which grew 55.6% and 70.1% year over year to $1.4 billion and $773 million, respectively.
Increasing total payments volume (TPV), courtesy of the robust Mercado Pago, aided the company.
The company’s rising gross merchandise volume (GMV), owing to increasing mobile GMV, remained another positive.
Strong shipment growth on MercadoEnvios and the growing penetration of managed networks in the reported quarter was a tailwind.
Strengthening momentum across Mercado Fondo and Mercado Credito also benefited the company.
Quarter in Detail
Brazil: Net revenues in the second quarter were $1.13 billion (52.9% of total revenues), soaring 56.4% year over year.
Argentina: The market generated revenues of $474.62 million (22.3% of the top line), which rose 47% year over year.
Mexico: Net revenues in the reported quarter were $392.3 million (18.4% of revenues), soaring 92% year over year.
Other countries: The markets generated revenues of $136.71 million (6.4% of total revenues), climbing 72.6% on a year-over-year basis.
Key Metrics
GMV of $8 billion jumped 21.2% and 32.2% on a reported and FX-neutral basis, respectively, from the year-ago quarter. Notably, mobile GMV accounted for 75.5% of the total GMV.
The number of successful items sold was 287.9 million, up 25.5% year over year. The number of successful items shipped rose 29% year over year to 275.9 million. This can be attributed to the sturdy performance of MercadoEnvios.
TPV increased 52.1% and 72.8% year over year on a reported and FX-neutral basis, respectively, to $24.2 billion. This was driven by the strong performance of MercadoPago. Off-platform payment volume (online-to-offline) was $16.1 billion, up 75.1% from the year-ago quarter.
Acquiring TPV, which includes on-platform, online Payments, MPoS and QR payments, was $17.2 billion, up 51.1% year over year.
Also, $7.1 billion of digital accounts TPV, including wallet payments, P2P transfers between Mercado Pago accounts and card transactions, surged 138.3% year over year.
TPV on marketplace was $7.8 billion, up 22.5% year over year. Total payment transactions increased 56.1% year over year to 1.03 billion.
Unique active users totaled 82.2 million, up 11.1% year over year.
Operating Details
For the fourth quarter, the gross margin was 40%, expanding 320 basis points year over year.
Operating expenses were $829.8 million, which increased 61.4% year over year. However, as a percentage of revenues, the figure expanded 20 bps from the year-ago quarter to 38.9% in the reported quarter.
The company reported $23.32 million of income from operations in the reported quarter against the operating loss of $25.13 million in the year-ago quarter.
Balance Sheet
As of Dec 31, 2021, cash and cash equivalents were $2.6 billion, up from $987.2 million as of Sep 30, 2021.
Short-term investments were $809.5 billion for the fourth quarter, down from $1.04 billion in the previous quarter.
Accounts receivable amounted to $98.2 million, up from $70.5 million in the third quarter. Inventory level at the fourth-quarter end was $253.1 million, up from $226.7 million at the end of the prior quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted 14.42% due to these changes.
VGM Scores
At this time, MercadoLibre has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. It's no surprise MercadoLibre has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is MercadoLibre (MELI) Up 31.7% Since Last Earnings Report?
A month has gone by since the last earnings report for MercadoLibre (MELI - Free Report) . Shares have added about 31.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MercadoLibre due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Mercadolibre Reports Loss in Q4
MercadoLibre reported a fourth-quarter 2021 loss of 92 cents per share against the Zacks Consensus Estimate for earnings of 89 cents. The figure compares favorably with the year-ago loss of $1.02 per share. Notably, the company reported earnings per share of $1.92 in the prior quarter.
Its revenues surged 60.5% on a year-over-year basis (73.9% on an FX-neutral basis) to $2.13 billion. The figure increased 14.7% sequentially. The top line surpassed the Zacks Consensus Estimate of $2 billion.
Revenues were driven by accelerating commerce and fintech revenues, which grew 55.6% and 70.1% year over year to $1.4 billion and $773 million, respectively.
Increasing total payments volume (TPV), courtesy of the robust Mercado Pago, aided the company.
The company’s rising gross merchandise volume (GMV), owing to increasing mobile GMV, remained another positive.
Strong shipment growth on MercadoEnvios and the growing penetration of managed networks in the reported quarter was a tailwind.
Strengthening momentum across Mercado Fondo and Mercado Credito also benefited the company.
Quarter in Detail
Brazil: Net revenues in the second quarter were $1.13 billion (52.9% of total revenues), soaring 56.4% year over year.
Argentina: The market generated revenues of $474.62 million (22.3% of the top line), which rose 47% year over year.
Mexico: Net revenues in the reported quarter were $392.3 million (18.4% of revenues), soaring 92% year over year.
Other countries: The markets generated revenues of $136.71 million (6.4% of total revenues), climbing 72.6% on a year-over-year basis.
Key Metrics
GMV of $8 billion jumped 21.2% and 32.2% on a reported and FX-neutral basis, respectively, from the year-ago quarter. Notably, mobile GMV accounted for 75.5% of the total GMV.
The number of successful items sold was 287.9 million, up 25.5% year over year. The number of successful items shipped rose 29% year over year to 275.9 million. This can be attributed to the sturdy performance of MercadoEnvios.
TPV increased 52.1% and 72.8% year over year on a reported and FX-neutral basis, respectively, to $24.2 billion. This was driven by the strong performance of MercadoPago. Off-platform payment volume (online-to-offline) was $16.1 billion, up 75.1% from the year-ago quarter.
Acquiring TPV, which includes on-platform, online Payments, MPoS and QR payments, was $17.2 billion, up 51.1% year over year.
Also, $7.1 billion of digital accounts TPV, including wallet payments, P2P transfers between Mercado Pago accounts and card transactions, surged 138.3% year over year.
TPV on marketplace was $7.8 billion, up 22.5% year over year. Total payment transactions increased 56.1% year over year to 1.03 billion.
Unique active users totaled 82.2 million, up 11.1% year over year.
Operating Details
For the fourth quarter, the gross margin was 40%, expanding 320 basis points year over year.
Operating expenses were $829.8 million, which increased 61.4% year over year. However, as a percentage of revenues, the figure expanded 20 bps from the year-ago quarter to 38.9% in the reported quarter.
The company reported $23.32 million of income from operations in the reported quarter against the operating loss of $25.13 million in the year-ago quarter.
Balance Sheet
As of Dec 31, 2021, cash and cash equivalents were $2.6 billion, up from $987.2 million as of Sep 30, 2021.
Short-term investments were $809.5 billion for the fourth quarter, down from $1.04 billion in the previous quarter.
Accounts receivable amounted to $98.2 million, up from $70.5 million in the third quarter. Inventory level at the fourth-quarter end was $253.1 million, up from $226.7 million at the end of the prior quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted 14.42% due to these changes.
VGM Scores
At this time, MercadoLibre has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. It's no surprise MercadoLibre has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.