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On Thursday, Jefferies analysts announced a downgrade of MercadoLibre (NASDAQ: NASDAQ:MELI) stock from Buy to Hold. This decision comes despite an increase in the price target to $2,800 from the previous $2,450. The analysts cited improved profitability and cash flow projections for 2029 and beyond as reasons for the price target adjustment. According to InvestingPro data, the company maintains impressive gross profit margins of 52.24% and has received upward earnings revisions from six analysts for the upcoming period.
Jefferies analysts acknowledged MercadoLibre’s strong year-to-date performance, with shares rising over 50%. This aligns with InvestingPro data showing a 51.37% YTD return and the stock trading near its 52-week high. Despite this impressive growth, the analysts expressed a more cautious stance moving forward, leading to the rating change. Want deeper insights? InvestingPro offers 20+ additional tips and comprehensive analysis for MELI.
In their analysis, Jefferies highlighted the company’s potential in various sectors, including commerce, acquiring, credit, and advertising. They continue to regard MercadoLibre as a high-quality long-term investment with numerous growth opportunities in the region.
The decision to downgrade the stock rating reflects Jefferies’ assessment of the company’s current market position following a robust performance in 2023. The analysts emphasized the importance of reassessing MercadoLibre’s total addressable markets in light of its recent achievements.
MercadoLibre, a leading e-commerce company in Latin America, has been noted by Jefferies for its ongoing growth prospects. The analysts’ updated view reflects a balance between recognizing the company’s strengths and adjusting expectations given its recent stock performance.
In other recent news, MercadoLibre has reported impressive first-quarter 2025 results, with earnings and revenue exceeding Wall Street expectations. Benchmark analyst Fawne Jiang noted significant gains in both revenue and profitability, particularly in Argentina, where commerce growth forecasts were surpassed. Cantor Fitzgerald analyst Deepak Mathivanan highlighted the company’s strong Gross Merchandise Volume growth, especially in Brazil and Argentina, alongside a notable expansion in the Fintech sector’s total payment volume. As a result, Mathivanan raised the price target for MercadoLibre shares to $2,900, while maintaining an Overweight rating. Meanwhile, UBS analysts increased their price target to $3,000, citing MercadoLibre’s strong performance in e-commerce and fintech sectors, as well as favorable macroeconomic conditions in Argentina. JPMorgan also adjusted its price target to $2,600, reflecting a higher contribution from Argentina, despite caution over the competitive landscape in Brazil. Additionally, MercadoLibre announced a leadership transition, with Ariel Szarfsztejn set to become CEO in 2026, as current CEO Marcos Galperin transitions to Executive Chairman. These developments indicate a dynamic period for MercadoLibre, with analysts expressing varying degrees of optimism about the company’s future prospects.
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