MercadoLibre (MELI) closed at $2,172.75 in the latest trading session, marking a -3.29% move from the prior day. The stock trailed the S&P 500, which registered a daily gain of 0.01%. At the same time, the Dow added 0.51%, and the tech-heavy Nasdaq lost 0.28%.
Prior to today's trading, shares of the operator of an online marketplace and payments system in Latin America had lost 7.08% lagged the Retail-Wholesale sector's gain of 1.34% and the S&P 500's gain of 4.83%.
The investment community will be closely monitoring the performance of MercadoLibre in its forthcoming earnings report. The company is expected to report EPS of $9.88, up 26.18% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $7.17 billion, up 35.05% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $43.66 per share and a revenue of $27.83 billion, representing changes of +15.84% and +33.93%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for MercadoLibre. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 1.72% lower. MercadoLibre presently features a Zacks Rank of #4 (Sell).
In terms of valuation, MercadoLibre is currently trading at a Forward P/E ratio of 51.45. This indicates a premium in contrast to its industry's Forward P/E of 21.53.
We can additionally observe that MELI currently boasts a PEG ratio of 1.49. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MELI's industry had an average PEG ratio of 1.49 as of yesterday's close.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 42, finds itself in the top 18% echelons of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained 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 ReportThis article originally published on Zacks Investment Research (zacks.com).
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