What happened
MercadoLibre (MELI 2.67%) shareholders beat the market on Monday as the stock gained 6% by 3 p.m. ET, compared to a slight drop in the S&P 500. The boost removed just a small piece of the e-commerce giant's recent losses. It remains in deeply negative territory so far in 2022.
However, investors appear to be gaining more confidence in its business ahead of major financial announcements on the way.
Image source: Getty Images.
So what
Analysts at Morgan Stanley issued a positive note on MercadoLibre's business ahead of its upcoming earnings report. The Latin American e-commerce giant in late February noted solid growth through late 2021, with sales volumes spiking 32% in the fiscal fourth quarter after accounting for currency exchange swings .
Morgan Stanley sees that good news carrying through into the fiscal first quarter and expects earnings to slightly outperform most Wall Street expectations. The investing firm reiterated its buy rating on MercadoLibre's stock, helping set the stage for its positive move on Monday .
Now what
Some investors see good reasons to like the stock today, including the company's opportunity for market share growth as it capitalizes on recent investments into its delivery network.
Shares could see more volatility around Amazon's upcoming earnings report, set for Thursday, April 28. The e-commerce giant's demand trends will show whether consumers are still shopping online enthusiastically even as the threat from the pandemic faded in early 2022.
But the key test of the optimism that sent MercadoLibre shares higher today will be its upcoming earnings report in early May. Follow that announcement for the company's latest sales-volume trends and management's updated outlook for the rest of fiscal 2022.
