On January 29, Coronation Fund Managers disclosed a buy of MercadoLibre(NASDAQ:MELI), adding 53,352 shares in an estimated $112.06 million trade based on quarterly average pricing.
According to a SEC filing dated January 29, Coronation Fund Managers increased its stake in MercadoLibre(NASDAQ:MELI) by 53,352 shares during the fourth quarter. The estimated value of the trade was $112.06 million based on the average closing price for the period. The position’s total value at quarter’s end was $285.59 million, up by $78.93 million from the previous filing and reflecting both new purchases and share price changes.
Coronation Fund Managers increased its MercadoLibre position, bringing the stake to 12.81% of its $2.23 billion reportable AUM as of December 31.
Top holdings after the filing:
NASDAQ:MELI: $285.59 million (12.8% of AUM)
NYSE:SE: $285.19 million (12.8% of AUM)
NYSE:NU: $241.11 million (10.8% of AUM)
NYSE:CPNG: $140.04 million (6.3% of AUM)
NASDAQ:MMYT: $102.76 million (4.6% of AUM)
As of January 28, MercadoLibre shares were priced at $2,268.60, up 19.7% over the past year and outperforming the S&P 500 by 4.68 percentage points.
Metric
Value
Price (as of January 28)
$2,268.60
Market capitalization
$114.02 billion
Revenue (TTM)
$26.19 billion
Net income (TTM)
$2.08 billion
MercadoLibre operates a leading e-commerce and digital payments platform serving businesses and consumers across Latin America.
The company generates revenue primarily through transaction fees on its marketplace, financial services, logistics, and value-added services for merchants and consumers.
It serves businesses, merchants, and individual consumers in Latin America, targeting both sellers and buyers seeking online commerce and digital financial solutions.
MercadoLibre is a leading e-commerce and fintech platform in Latin America, operating at a significant scale with a broad regional footprint. The company leverages its integrated ecosystem of online marketplaces, digital payments, credit, and logistics to drive growth and deepen user engagement. Its competitive advantage stems from a robust network effect and a diversified suite of technology-driven services tailored to the unique needs of the Latin American market.
What matters here is not the size of the purchase but the role this holding now plays inside the portfolio. At nearly 13% of reportable assets, this position sits alongside the fund’s highest-conviction ideas, signaling a willingness to concentrate capital where long-term compounding still appears intact. That stands out in a portfolio already heavy on emerging-market growth and platform businesses.
The latest quarter reinforces why. MercadoLibre continues to scale across commerce, payments, and credit at the same time, with its ecosystem driving higher engagement and monetization per user. Revenue growth remains strong (up 39% year over year in the third quarter), margins are expanding, and logistics investments are increasingly paying off through faster delivery and better unit economics. Importantly, the company’s fintech arm keeps deepening customer relationships, giving the platform multiple ways to grow without relying on pure retail volume.
This fund pairs MercadoLibre with names like Sea, Nubank, and Coupang, all bets on digitally native infrastructure in underpenetrated markets. Within that framework, adding here suggests confidence that MercadoLibre’s competitive moat remains intact despite its size.
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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends MakeMyTrip, MercadoLibre, and Sea Limited. The Motley Fool recommends Coupang and Nu Holdings. The Motley Fool has a disclosure policy.
The stock market has delivered average annual returns of about 10% going back decades, which is enough to double your money every seven years. But it’s not that difficult to grow your money faster with well-chosen growth stocks.
To give you some ideas, three Motley Fool contributors believe On Holding(NYSE: ONON), MercadoLibre(NASDAQ: MELI), and Dutch Bros(NYSE: BROS) can help you achieve above-average returns. Here’s why.
Running past the competition
Jennifer Saibil (On Holding): On has distinguished itself as a top premium brand that is challenging names like Nike and Lululemon Athletica. It stands out for its soaring growth despite inflation, and it’s just getting started. It has a massive growth runway as it builds its brands and attracts loyal fans, and growth-minded investors should take a look.
First, the numbers. On reported phenomenal results in the 2024 second quarter, beginning with a 29% year-over-year sales increase (currency neutral). Profitability was outstanding, with gross margin expanding from 59.5% to 59.9% and net income up by 834%.
The results were so strong that Wall Street was willing to forgive its earnings miss — it was expecting $0.18 in earnings per share (EPS), while On’s EPS came in at $0.17. A penny might look insignificant, but Wall Street has crushed stocks for misses that were less than that.
Next, the opportunity. On still has a low brand presence pretty much everywhere, and it’s impressing shoppers as it develops its name through marketing efforts, new direct-to-consumer shops, and wholesale distribution deals. It has its finger on the pulse of current shopping trends, and sales are increasing about equally through direct-to-consumer and wholesale channels.
While it’s best known for its shoes, many of which feature a unique sole that’s become its imprint, its premium branding is earning a following and resulting in interest in its apparel and accessories. All of these categories are growing at a brisk pace, but apparel was a standout in the second quarter, increasing 66% year over year, and it’s an opportunity that On is leveraging. It recently launched a partnership with celebrity Zendaya, for example, as a lifestyle and fashion icon, as well as a branded tennis collection.
On is expecting full-year sales growth to ramp up to at least 30%, which is likely what led to the positive market reaction after the results were released, and it’s implementing new efficiency models in the second half of the year. Expect On stock to keep soaring this year and in the long term.
This stock has returned 1,600% and is still undervalued
John Ballard (MercadoLibre): Latin America is one of the fastest-growing e-commerce markets globally, and MercadoLibre has capitalized on that to deliver phenomenal returns to shareholders over the last several years.
There are several ways it generates revenue, which speaks to the opportunities it has to deliver growth. It operates a marketplace for buyers and sellers where it earns transaction fees. It also sells its own inventory to consumers from its own fulfillment system. But one of its fastest-growing services is in-store transactions with its fintech offering.
The marketplace continues to show incredible growth in gross merchandise volume (GMV). Brazil and Argentina — two of its largest markets — reported GMV increases of 36% and 252% year over year in the second quarter. This comes as the company introduces new shipping options and investments to expand its last-mile delivery capabilities.
MercadoLibre recently launched a fulfillment center in Texas, which will expand the selection of products to customers in Mexico. It’s an example of the potential MercadoLibre has to find ways to drive strong growth for shareholders.
The best part is that despite the stock’s 1,600% return over the last 10 years, it is trading at its cheapest price-to-sales (P/S) ratio in years. It’s currently trading at a P/S multiple of 5.6 — below its previous 10-year average of 10.
With the company’s revenue still growing at high rates — up 113% year over year last quarter (excluding currency changes) — the stock could deliver wealth-building returns to shareholders. All the stock needs to do is continuing trading at the current P/S multiple.
A coffee stock that’s just heating up
Jeremy Bowman (Dutch Bros): One of the more puzzling stock movements in recent weeks came in after Dutch Bros reported second-quarter earnings.
The fast-growing drive-thru coffee chain reported strong results with revenue jumping 30% to $325 million on same-store sales growth of 4.1%. Its margins also improved with generally accepted accounting principles (GAAP) net income more than doubling $22.2 million. It beat estimates on both the top and bottom lines.
However, in spite of the strong results and an increase in financial guidance, Dutch Bros stock plunged on the update, falling 20% on Aug. 8.
The reason for the sell-off seemed to be because the company said that new store openings for the year would now come in toward the lower end of its guidance range of 150 to 165. There wasn’t any particular reason for that update, and it’s nothing that would indicate long-term problems for the business. It’s probably just delays in construction or permitting or other vagaries of the real industry.
Punishing the stock for modestly slower expansion this year seems excessive and illogical, especially considering the company raised its full-year revenue guidance from $1.215 billion to $1.23 billion from $1.2 billion to $1.215 billion.
The stock is still trading at a premium after the discount, but it also shows the business is misunderstood as the company was able to accelerate revenue growth even with the setback on new stores, an achievement that should be rewarded.
Dutch Bros has less than 1,000 stores currently and a long growth runway ahead of it considering that established coffee chains like Dunkin’ and Starbucks have several thousand locations in the U.S.
Investors should take advantage of the sell-off and buy a piece of this fast-growing restaurant chain that’s firing on all cylinders.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $20,001!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $42,511!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $357,669!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.
Jennifer Saibil has positions in MercadoLibre. Jeremy Bowman has positions in MercadoLibre, Nike, and Starbucks. John Ballard has positions in Dutch Bros and MercadoLibre. The Motley Fool has positions in and recommends Lululemon Athletica, MercadoLibre, Nike, and Starbucks. The Motley Fool recommends Dutch Bros and On Holding and recommends the following options: long January 2025 $47.50 calls on Nike. The Motley Fool has a disclosure policy.
The market loves a good stock split. When a company decides to split its shares, it is a reflection of the company’s success and also indicates management’s confidence in its future. In other words, it’s almost always top stocks demonstrating strong performance that go for stock splits.
The two newest stock-split stocks currently gripping the market are Walmart, whose 3-for-1 stock split went through in February, and Chipotle Mexican Grill, which announced a gargantuan 50-for-1 split last week. Both of these stocks are outpacing the broader market this year.
Will other stocks follow? Costco Wholesale(NASDAQ: COST) and MercadoLibre(NASDAQ: MELI) are two stocks that look poised for stock splits.
The unbeatable membership model
Costco has been a market-beating stock for decades. It has an incredible, unbeatable retail membership model that generates customer loyalty, high traffic, and strong sales. It charges $60 for a basic annual membership, which members more than make up for with their cost savings on their yearly purchases. Costco marks up products, which it sells mostly in bulk, with razor-thin margins to cover costs, and it makes its profits on the fees.
Sales growth was sluggish for most of last year and even headed into negative territory, but that was mostly attributable to shoppers cutting down on large, expensive items. Traffic and volume were up, as was membership.
In fiscal 2024’s second quarter (ended Feb. 18), sales increased 5.9% year over year driven by a 5.6% increase in comparable sales and a 5.3% increase in traffic. Earnings per share (EPS) were up from $3.30 to $3.92. Membership fee increased 8.4% to $84 million, and paid household members increased 7.8% to $73.4 million. Renewal rates continue to be sky-high, with Canada and the U.S. at 92.9% and the global rate at 90.5%.
Costco has split its stock three times in the past, and the last time it did was 24 years ago. The stock is up almost 1,500% since then, and it’s up 48% over the past year. Each share cost more than $700 as of this writing.
Costco paid a $15 special dividend to shareholders earlier this year, and it’s also due for a membership fee hike. Walmart and Chipotle noted their strong performances and continued opportunities in their stock split announcements, and that applies to Costco, too. This could also be the year that it finally splits its stock.
The leader in Latin American e-commerce
MercadoLibre is the top Latin American e-commerce giant, similar to Amazon. Even though it’s not so young anymore, it operates in a market that’s exploding, and it’s still reporting exceptional growth in its e-commerce business. Gross merchandise volume (GMV) increased 79% year over year (currency neutral) in the 2023 fourth quarter.
Like Amazon, MercacoLibre has branched out into new businesses, and these are growing even faster. It has a large fintech business focused on digital payments, and total payment volume (TPV) was up 153% year over year in the fourth quarter. It has incredible opportunities in off-platform TPV, which are payments that aren’t made in its own marketplace. Off-platform TPV was up a whopping 182% in the fourth quarter.
As part of the fintech segment, MercadoLibre also operates a fairly new credit business. This is a lucrative undertaking that gives the company tons of cash to fund other ventures and invest for interest income. The credit portfolio increased 33% year over year in the fourth quarter.
Total company revenue increased 83% year over year in the quarter. Net income was negatively impacted by a tax liability in the fourth quarter, but MercadoLibre remains reliably profitable, with $165 million in the fourth quarter.
MercadoLibre has been a public company since 2007, and it has never split its stock. It’s gained more than 5,000% in its lifetime and trades with a price tag of $1,540 today. Hitting four digits often leads to a stock split, but MercadoLibre has been in that bracket for some time. Its stock is about flat this year, falling after the fourth-quarter report and the drop in profits.
In contrast to the reasons for the other stock splits mentioned above, a stock split could stimulate greater interest in MercadoLibre stock and signal that management is confident about the future. In any case, this is a great opportunity for investors to buy in before MercadoLibre stock starts climbing again.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Jennifer Saibil has positions in MercadoLibre. The Motley Fool has positions in and recommends Amazon, Chipotle Mexican Grill, Costco Wholesale, MercadoLibre, and Walmart. The Motley Fool has a disclosure policy.
