In 1999, MercadoLibre (MELI 1.65%) launched its online marketplace in four Latin American countries to provide an easy way to connect buyers and sellers. Since then, it's grown to serve 18 countries with a marketplace platform that's sold $16 billion in goods over the last 12 months, and processed a staggering $35.5 billion in payments through its Mercado Pago service.

But it's just getting started. Here are 11 reasons you should buy this e-commerce ecosystem regional leader and never sell.

1. MercadoLibre is playing in a huge market

MercadoLibre serves the Latin American region, which has a population of 638 million people, 362 million internet users, and 200 million online shoppers. Even with this broad base of internet-connected consumers, amazingly, only 4.4% of all retail purchases in Latin America were made online in 2019. But that's changing and it means a huge potential market for MercadoLibre to tap into.

Jar full of coins with a plant growing out of it.

Image source: Getty Images.

2. The coronavirus has accelerated the move to e-commerce

As the coronavirus pandemic spread, many consumers turned to online shopping, and MercadoLibre's marketplace captured 5 million new and reactivated shoppers just in February, March, and April of 2020. In the second quarter, ending June 30, 2020, shoppers purchased 178.5 million items, a 69% increase over the first quarter, and spent $5 billion, a 48% increase over Q1.

3. MercadoLibre is widening its moat

The company is investing significantly in its logistics network. It recently opened its first fulfillment centers in Chile and Colombia, and now has over 1,300 package drop-off points in Brazil to help reduce shipping costs. Over the past year, it doubled the percentage of goods handled through its shipping network, from 26% in Q2 2019 to over 50% in Q2 2020. This robust network is enabling the company to offer free shipping for 62% of its goods sold as of the fourth quarter of 2019, and MercadoLibre is looking to expand this offering as costs come down.

4. It's not just an e-commerce business

MercadoLibre's e-commerce marketplace is only one of six complementary services it offers to buyers and sellers. Its services include classified ads for selling used goods locally, a Shops product which helps sellers build online shops, and its credit services which allow cash advances to buyers and capital loans for sellers. But its Mercado Pago payment service is by far the largest revenue-generating product outside of its e-commerce marketplace.

5. MercadoLibre's payments business is growing like crazy

The company's payment platform surpassed 52 million payers in its most recent quarter, up 64% year over year. The platform processed over $11 billion in transactions, up 142% year over year as measured by local currency. Its off-platform payments now exceed the transactions on its marketplace by 17%, and they are growing faster at a rate of 175% year over year in the most recent quarter. Revenue for its non-marketplace business was a substantial $297 million for the quarter, more than a third of the overall revenue. 

6. Its fintech business is just getting off the ground

The incredible success with its payments platform has management looking to extend its financial offerings to serve the broad-based unbanked and underbanked population in the region. With a goal to make its Mercado Pago service a "powerful disruptive provider of end-to-end financial technology solutions," look for even more fintech products coming from this innovator.

7. MercadoLibre is a tech company in disguise 

Over the past seven years, management has expanded its information technology and product development teams by more than 10-fold and increased spending almost eight-fold. The company views its software team as one of its "key competitive advantages," and this focus will help it to maintain its leadership position.

8. It's founder-run

Companies where a founder is still involved have been shown to have their stocks outpace peers by a significant margin. MercadoLibre's co-founder, Marcos Galperin, serves as Chairman of the Board, President, and CEO and is still deeply involved with the day-to-day operations of the company.

9. It's got a committed management team

Four out of five members of the C-suite are employees with at least two decades with the company. Not only are these team members tenured employees, but they have experience in a variety of positions, which gives them an incredible depth of knowledge about the company operations. Since they've worked together extensively, investors should have confidence in their ability to tackle even the most difficult issues.

10. MercadoLibre has got tons of cash

The balance sheet shows $3.3 billion in cash, cash equivalents, and marketable securities, giving MercadoLibre plenty of flexibility and stability to invest during economic downturns. The company has put some of this cash to work in the past, acquiring technology companies, and investing in its fulfillment network and its technology team. With solid cash flows from operations, it has recently announced a $350 million stock buyback, representing about 6% of outstanding shares.

11. Its employees love working there

Glassdoor is a website that allows current and former employees to post anonymous ratings and reviews about the companies they work for. These ratings can be informative to the investing process and provide insights into company culture. MercadoLibre's ratings are stellar, with 95% of employees recommending the company as a place to work and 96% approving of the job the CEO is doing. This isn't a buy signal by itself, but it certainly adds credibility to its leadership team.

The bottom line for investors

MercadoLibre has thrived in a challenging region to become a $2.8 billion annual revenue run rate business. But in many ways, it's just at the beginning of its journey. A tailwind of the coronavirus is accelerating e-commerce, contactless payments, and attracting more customers to its platform. With its smart investments, proven management team, and solid business model, you would do well to buy this growth stock and never sell.