Why the “eBay of Latin America” Is on Fire

By Chris Hill and Matthew Argersinger – Aug 2, 2013 at 4:31PM

NASDAQ: MELI

MercadoLibre

Market Cap

$69B

Today's Change

(-1.01%) -$13.82

Current Price

$1,356.43

Price as of April 19, 2024, 4:00 p.m. ET

MercardoLibre shares have doubled in the past year. Here’s why they’re going even higher.

MercadoLibre (MELI -1.01%) is the dominant player is Latin American e-commerce. With second-quarter profits up 18%, and revenue up nearly 40%, the stock is hitting a new 52-week high. While some say the stock's valuation is too rich, analyst Matt Argersinger says it still has a lot of room to run.

By virtually every metric, MercadoLibre's business is on fire. eBay (EBAY 0.88%) itself has an 18% stake in MercadoLibre, and the two companies view themselves as partners, not competitors. And while today MercadoLibre's market cap is a mere fraction of eBay's, Argersinger believes, in 10 years, it will grow to be half of eBay's market cap.

Chris Hill owns shares of eBay. Fool contributor Matthew Argersinger owns shares of MercadoLibre. The Motley Fool recommends eBay and MercadoLibre. The Motley Fool owns shares of eBay and MercadoLibre. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.