4-Star Stocks Poised to Pop: MercadoLibre

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, South American online auction operator MercadoLibre (Nasdaq: MELI  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at MercadoLibre's business and see what CAPS investors are saying about the stock right now.

MercadoLibre facts

Headquarters (Founded) Buenos Aires, Argentina (1999)
Market Cap $2.9 billion
Industry Business services
Trailing-12-Month Revenue $198.07 million
Management

Co-Founder/CEO Marcos Galperin

Co-Founder/CFO Hernan Kazah

Return on Equity (Average, Past 3 Years) 26.9%
Cash/Debt $42.85 million / $217.13 thousand
Competitors

Amazon.com (Nasdaq: AMZN  )

Google (Nasdaq: GOOG  )

Microsoft (Nasdaq: MSFT  )

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 92% of the 913 members who have rated MercadoLibre believe the stock will outperform the S&P 500 going forward. These bulls include All-Star Caligiuri, who is ranked in the top 0.5% of our community, and stokker3.

Just last week, Caligiuri noted that MercadoLibre "is the leader in the Latin America online marketplace industry." Our CAPS All-Star continues: "[MercadoLibre] is growing at a fast pace and appears to have a bright future in front of it with room to run."

MercadoLibre is often referred to as the "eBay" (Nasdaq: EBAY  ) of Latin America (eBay even owns 18% of the company), so it's no surprise that Fools are drawn to its powerful network effects and tasty growth prospects. Over the next five years, MercadoLibre is even expected to grow earnings at a substantially faster clip (40% per annum) than e-commerce titans Amazon (26%), Google (17%), and Microsoft (10%). If MercadoLibre has as much potential as CAPS member stokker3believes, those growth expectations seem pretty reasonable:

The growth potential of this company is off the charts, since Latin Americans are getting online more and more, but there is still a long way to go. The company is already growing at rapid rates and still has business segments that have yet to hit full stride, like Pago (it's PayPal like payments platform). They also have not rolled out a mobil app., which could further ignite its' growth. With no debt and excellent cash flow, the company can finance it's own growth through acquisitions on top of the businesses mentioned above.

What do you think about MercadoLibre, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. MercadoLibre and Google are Motley Fool Rule Breakers picks. Google is also an Inside Value choice, as is Microsoft. Motley Fool Options has recommended a diagonal call position on Microsoft. eBay is a selection of Stock Advisor, and Motley Fool Options has recommended a bull call spread position on it. The Fool owns shares of Google and Microsoft. Try any of our Foolish newsletter services free for 30 days.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Fool's disclosure policy always gets a perfect score.


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