Want To Own The Amazon Of Latin America? Checkout MercadoLibre

Want To Own The Amazon Of Latin America? Checkout MercadoLibre

As 2021 winds down, many stocks are trading well off their year-to-date highs. One such example is MercadoLibre, Inc. (MELI), which as of this writing is down about 40% from its January peak. MercadoLibre is widely considered the "Amazon of Latin America." The company is the largest e-commerce provider in the fastest growing e-commerce region in the world. MercadoLibre's network of over 132 million active buyers is spread across an 18-country footprint, with most of its revenue derived from Brazil (55%), Argentina (25%) and Mexico (15%). Over the last year, booming e-commerce sales helped drive 73% sales growth for MercadoLibre. By comparison, Amazon and Alibaba achieved 38% and 41% topline growth, respectively. According to Bloomberg Intelligence analyst, Julie Chariell, MercadoLibre is poised to continue benefitting from e-commerce adoption amongst Latin American consumers. She writes, "E-commerce's penetration of retail sales in Latin America has significantly advanced since Covid-19 began, doubling to nearly 6%, and can approach 10% by 2025, in our view. Smartphone and digital-payment adoption are key drivers of e-commerce enablement, but stand where the U. S. was in 2013-14. About 50% of the LatAm population has a smartphone vs. 81% in the U. S., where e-commerce penetration exceeds 15%."