Key Points
MercadoLibre's revenue grew 45% in the fourth quarter of 2025.
The company's fintech arm is expanding its financial services and rapidly increasing its number of users.
The stock has fallen 12% to start 2026.
MercadoLibre's (NASDAQ: MELI) stock fell after its earnings miss and fears of increasing competition from Amazon (NASDAQ: AMZN). While some investors soured on MercadoLibre, others see an opportunity to capitalize on strong and sustainable growth during this dip. There are five good reasons to buy MercadoLibre like there's no tomorrow. Let's find out why.
High growth that's also sustainable
In the fourth quarter of 2025, MercadoLibre's revenue grew 45% year over year to $8.7 billion. In 2025, the company grew its total revenue 39%. MercadoLibre is investing heavily in technology, logistics, and shipping abilities.
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These expenses negatively impacted short-term profitability, but in the long term, they will help MercadoLibre dominate multiple emerging markets. In Chile, Colombia, and Peru, growth was particularly strong in this latest quarter. Growth in Peru hit 57%.
Image source: Getty Images.
A fintech powerhouse
MercadoLibre is so much more than just e-commerce. Its fintech segment, Mercado Pago, now has 78 million monthly active users. Moreover, its credit portfolio grew by 90% in the fourth quarter of 2025 to $12.5 billion.
Mercado Pago is now a full-fledged digital bank in a region eager to get more people paying for goods and services online. MercadoLibre offers a suite of financial services, ranging from payments to loans, and the company continues to add stickiness to its platform.
Exploring untapped markets
Latin America is still in an early stage of e-commerce and digital banking adoption. MercadoLibre is fully taking advantage of this opportunity and providing the infrastructure these emerging markets need to get more and more people transacting online. This fact provides MercadoLibre with a multiyear runway for growth.
An innovation leader
MercadoLibre announced a partnership with Agility Robotics in December 2025 to deploy robots in warehouse operations. These humanoid robots will improve logistics efficiency and lower costs through automation. The investment in tech-forward improvements now should pay off for many more years to come.
An attractive valuation
With the stock down 12% year to date, the company's valuation metrics are looking more attractive. MercadoLibre's forward P/E ratio is down to 26, and its PEG ratio has fallen to 0.87. In general, these metrics indicate that the stock is fairly priced or slightly undervalued.
There's also consensus among analysts that MercadoLibre is a buy. Yes, Amazon wants a piece of the Latin American pie and will compete fiercely. There's also political and economic risk throughout Latin America. Still, MercadoLibre has the infrastructure and a rapidly growing user base in the region, which give it an advantage.
The company's leadership is also battle-tested, with founder and CEO Marcos Galperin at the helm for more than 20 years. MercadoLibre is a fairly priced stock that is positioned for strong international growth over the next several years.
Should you buy stock in MercadoLibre right now?
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Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and MercadoLibre. The Motley Fool has a disclosure policy.
