MELI · MercadoLibre, Inc.
AI read · Good for MELI
The AI's read
MercadoLibre posted record revenue and an EPS beat, but net income dropped for a third consecutive quarter and operating margin compressed 550 basis points. Free-shipping costs and credit-card expansion are the explicit culprits for the profit squeeze. The stock is down ~1% and RSI is 28, so some of the move is already on the tape. Yet the margin deterioration is fresh and recurring, which can sustain selling pressure beyond the initial knee-jerk reaction. Our take leans bearish on profit quality despite the top-line strength. Confidence is moderate-high because the hit is company-specific and clear in the results, though downside looks capped near recent lows.