What Makes MercadoLibre (MELI) an Attractive Financial Model?

Loomis Sayles, an investment management company, released its “Global Growth Fund” investor letter for the second quarter of 2025. A copy of the letter can be downloaded here. In the second quarter, the fund returned 16.61% compared to 11.53% for the MSCI ACWI Index Net. The firm seeks to invest in high-quality businesses that possess sustainable competitive advantages and experience profitable growth, especially when these companies are trading at a substantial discount to their intrinsic value. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Loomis Sayles Global Growth Fund highlighted stocks such as MercadoLibre, Inc. (NASDAQ:MELI). MercadoLibre, Inc. (NASDAQ:MELI) is an online commerce platform that operates Mercado Libre Marketplace and Mercado Pago FinTech platforms. The one-month return of MercadoLibre, Inc. (NASDAQ:MELI) was 5.11%, and its shares gained 21.06% of their value over the last 52 weeks. On September 29, 2025, MercadoLibre, Inc. (NASDAQ:MELI) stock closed at $2,501.31 per share, with a market capitalization of $126.81 billion.

Loomis Sayles Global Growth Fund stated the following regarding MercadoLibre, Inc. (NASDAQ:MELI) in its second quarter 2025 investor letter:

"MercadoLibre, Inc. (NASDAQ:MELI) is the largest online commerce platform in Latin America. The company offers its users an ecosystem of six integrated e-commerce services that include its marketplace, payment and fintech solutions, shipping and logistics, advertising, classified listings, and merchant web services. In its most recent fiscal year, commerce and related services accounted for approximately 59% of net revenue, while payments and fintech solutions accounted for approximately 41%. The company operates in 18 countries representing the vast majority of Latin American GDP, and its 218 million active users, last disclosed in 2023, represented over 45% of the region’s estimated 480 million total internet users. We believe MercadoLibre benefits from strong and sustainable competitive advantages that include its network and ecosystem, brand, and understanding of local markets that collectively contribute to its leadership position in each market it serves. With continued growth in internet access, increasing availability of credit, and the company’s continuing investments to improve the ease and convenience of transacting online, we believe MercadoLibre remains well positioned for sustained growth over the next decade, driven by the secular growth of e-commerce across Latin America.

A fund holding since inception, MercadoLibre reported strong quarterly financial results that were above consensus expectations for gross merchandise volume (GMV), revenue, operating income, and earnings per share. The company continues to execute well and gained market share in e-commerce, payments, and financial services. Despite remaining in a period of elevated investment spending, the company also showed improvements in operating profits that were materially above consensus expectations. Since 2019, the company’s GMV has increased by approximately 3.5 times, reflecting the high value proposition to consumers, and the company continues to invest in providing better selection, price, and service..." (Click here to read the full text)

MercadoLibre, Inc. (NASDAQ:MELI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 116 hedge fund portfolios held MercadoLibre, Inc. (NASDAQ:MELI) at the end of the second quarter, which was 108 in the previous quarter. In the second quarter of 2025, MercadoLibre, Inc. (NASDAQ:MELI) delivered another strong quarter of financial performance with revenues growing over 30% year-on-year and record income from operations of $825 million. While we acknowledge the potential of MercadoLibre, Inc. (NASDAQ:MELI) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered MercadoLibre, Inc. (NASDAQ:MELI) and shared the list of stocks that will double in the next 5 years. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.