Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, South American online auction site operator MercadoLibre (NASDAQ:MELI) has earned a respected four-star ranking. While five-star stocks have been the best performers, our data has shown that four-star stocks still outshine the market by a significant margin and shouldn't be taken lightly; conversely, low-rated stocks have woefully lagged the market average.

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

$617 million

Industry

Internet Software & Services

TTM Revenue

$113 million

Management

Co-Founder/CEO Marcos Galperín

Co-Founder/COO Hernan Kazah

TTM Return on Capital

26.6%

Competitors

Amazon.com (NASDAQ:AMZN),

Yahoo! (NASDAQ:YHOO)

CAPS members bullish on MELI also bullish on

Google (NASDAQ:GOOG),

Baidu.com (NASDAQ:BIDU)

CAPS members bearish on MELI also bearish on

First Solar (NASDAQ:FSLR),

SunPower 

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, fully 620 of the 650 CAPS members who have rated MercadoLibre -- some 95% -- believe the stock will outperform the S&P 500 going forward. These Foolish bulls include CAPS All-Star 7dogs and StarbellySneech.

In May, 7dogs wrote that MercadoLibre is "Similar to [eBay (NASDAQ:EBAY)], but potentially much more opportunity for future growth because of the emerging economies of South America. Ebay owns about 15% of the company."

An earlier pitch from StarbellySneech shares that bullish attitude, focusing on the company's emerging opportunities:

I think that MercadoLibre has a great business model. They are profitable today on relatively low revenues which will grow well into the future. And the profitablity will increase as the revenues increase.

Another reason I like MELI is that I have spent a lot of time in South America and I see it as a huge potential market. The people are starved for true capitalism with a lot of tariffs and taxes. I think they can grasp this concept and spark a lot of entrepeneurship from the grass roots which can help carry all of the countries to a higher level of production and gnp.

What do you think about MercadoLibre, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

Foolish contributor Brian Pacampara owns no position in any of the companies mentioned. Amazon.com and eBay are Motley Fool Stock Advisor picks. Google and Baidu.com are Rule Breakers selections. The Fool's disclosure policy always gets a perfect score.