In the latest close session, MercadoLibre (MELI) was down 1.31% at $2,149.90. The stock's change was less than the S&P 500's daily gain of 0.16%. Meanwhile, the Dow gained 0.17%, and the Nasdaq, a tech-heavy index, added 0.26%.
Prior to today's trading, shares of the operator of an online marketplace and payments system in Latin America had gained 8.06% outpaced the Retail-Wholesale sector's gain of 5.12% and the S&P 500's gain of 1.89%.
Analysts and investors alike will be keeping a close eye on the performance of MercadoLibre in its upcoming earnings disclosure. 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. In the meantime, our current consensus estimate forecasts the revenue to be $8.49 billion, indicating a 40.2% growth compared to the corresponding quarter of the prior year.
MELI's full-year Zacks Consensus Estimates are calling for earnings of $39.8 per share and revenue of $28.63 billion. These results would represent year-over-year changes of +5.6% and 0%, respectively.
Investors should also note any recent changes to analyst estimates for MercadoLibre. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 1.54% downward. Currently, MercadoLibre is carrying a Zacks Rank of #4 (Sell).
Looking at valuation, MercadoLibre is presently trading at a Forward P/E ratio of 36.56. For comparison, its industry has an average Forward P/E of 17.7, which means MercadoLibre is trading at a premium to the group.
We can additionally observe that MELI currently boasts a PEG ratio of 1.08. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. MELI's industry had an average PEG ratio of 1.14 as of yesterday's close.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 160, putting it in the bottom 35% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming 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.
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MercadoLibre, Inc. (MELI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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