Shares of Latin American e-commerce company MercadoLibre (MELI -3.17%) jumped on Thursday, closing the trading day up 7.3%.
The growth stock's gain is likely due to a combination of a bullish overall market on Thursday and a recent price-target increase for the stock.
Highlighting the upbeat day in the overall market on Thursday, the S&P 500 rose about 1%. Many growth stocks like MercadoLibre saw their shares rise even more sharply.
Also potentially helping the stock was a recent analyst upgrade. On Wednesday, Deutsche Bank analyst Kunal Madhukar increased his 12-month price target for the stock from $1,530 to $2,200. Supporting his buy rating, he said the company is well positioned to benefit from a post-pandemic recovery.
But another analyst wasn't quite as bullish this week. Richard Cathcart of BBI downgraded his rating from outperform to neutral and gave the stock a $2,000 12-month target. That is still above the stock's $1,845 price as of this writing.
MercadoLibre has seen its revenue surge in recent quarters. In the third quarter of 2020, revenue soared 85% year over year in U.S. dollars and nearly 150% year over year on a currency-neutral basis. Growth in the quarter was fueled by a 92.2% year-over-year increase in unique active users and a more than doubling of items sold over the same time frame.
Investors will look for more strong momentum when the company reports its fourth-quarter results in early February.