In the latest trading session, MercadoLibre (MELI) closed at $1,641.16, marking a +1.81% move from the previous day. This change outpaced the S&P 500's 0.26% loss on the day. At the same time, the Dow added 0.17%, and the tech-heavy Nasdaq lost 0.97%.
The operator of an online marketplace and payments system in Latin America's stock has climbed by 3.51% in the past month, exceeding the Retail-Wholesale sector's loss of 7.14% and the S&P 500's gain of 0.23%.
Market participants will be closely following the financial results of MercadoLibre in its upcoming release. The company's upcoming EPS is projected at $8.69, signifying a 15.71% drop compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $9.77 billion, reflecting a 43.9% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $40.97 per share and a revenue of $40.36 billion, demonstrating changes of +3.98% and +39.68%, respectively, from the preceding year.
It is also important to note the recent changes to analyst estimates for MercadoLibre. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 6.12% lower. As of now, MercadoLibre holds a Zacks Rank of #5 (Strong Sell).
In the context of valuation, MercadoLibre is at present trading with a Forward P/E ratio of 39.35. This indicates a premium in contrast to its industry's Forward P/E of 16.79.
Also, we should mention that MELI has a PEG ratio of 0.99. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Internet - Commerce industry stood at 0.97 at the close of the market yesterday.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 152, finds itself in the bottom 38% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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MercadoLibre, Inc. (MELI): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).