In the latest close session, MercadoLibre (MELI) was down 2.01% at $1,973.70. This change lagged the S&P 500's daily gain of 0.19%. Meanwhile, the Dow gained 0.66%, and the Nasdaq, a tech-heavy index, lost 0.03%.
Shares of the operator of an online marketplace and payments system in Latin America witnessed a loss of 5.86% over the previous month, trailing the performance of the Retail-Wholesale sector with its loss of 1.45%, and the S&P 500's gain of 0.54%.
The investment community will be paying close attention to the earnings performance of MercadoLibre in its upcoming release. It is anticipated that the company will report an EPS of $11.66, marking a 7.53% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $8.49 billion, reflecting a 40.2% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $39.8 per share and revenue of $28.63 billion, which would represent changes of +5.6% and 0%, respectively, from the prior year.
Any recent changes to analyst estimates for MercadoLibre should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, 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 past month, there's been a 1.54% fall in the Zacks Consensus EPS estimate. MercadoLibre is currently sporting a Zacks Rank of #5 (Strong Sell).
In the context of valuation, MercadoLibre is at present trading with a Forward P/E ratio of 33.8. For comparison, its industry has an average Forward P/E of 17.55, which means MercadoLibre is trading at a premium to the group.
It's also important to note that MELI currently trades at a PEG ratio of 1. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Internet - Commerce industry had an average PEG ratio of 1.16.
The Internet - Commerce industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 104, placing it within the top 43% of over 250 industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
MercadoLibre, Inc. (MELI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
