New Street: MELI US (Buy, TP: $2,100, +35%) MercadoLibre Q3s Quick Take: Credit/Fintech Onward and Upward
MercadoLibre reported solid Q3s after close: revenue in-line and with profitability ahead. There was some supportive commentary on Commerce (launch of Fresh, fulfilment expansion) whilst the narrative around Fintech, given the sector backdrop, was pleasantly upbeat with a strong expansion in the Credit book, including good momentum on credit cards, with and seemingly more limited concerns on PAX and debit/cash card regulation. The release of a new definition of Active Fintech users at MercadoLibre (31.6m), whilst not comparable to Nubank's 35.3m, is hard not to contrast as the market mulls over the $50 billion Nubank valuation ahead of IPO.MercadoLibre is engages in an online commerce ecosystem. Co.'s platform is designed to provide users with a portfolio of services to facilitate commercial transactions. Co. integrated e-commerce services includes: the MercadoLibre Marketplace, which is an automated, topically-arranged and user-friendly online commerce service; MercadoLibre Classifieds Service, which users can also list and purchase motor vehicles, vessels, aircraft, real estate and services; MercadoPago payments solution, providing a mechanism that allows its users to send and receive payments online; and MercadoLibre advertising program, which enable businesses to promote their products and services on the Internet.
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