MercadoLibre has gotten torched over the last six months - since September 2025, its stock price has dropped 30.2% to $1,727 per share. This might have investors contemplating their next move.
Following the pullback, is this a buying opportunity for MELI? Find out in our full research report, it’s free.
Why Is MELI a Good Business?
Originally started as an online auction platform, MercadoLibre (NASDAQ: MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.
1. Eye-Popping Growth in Customer Spending
Average revenue per user (ARPU) is a critical metric to track because it measures how much the company earns in transaction fees from each user. ARPU also gives us unique insights into a user’s average order size and MercadoLibre’s take rate, or "cut", on each order.
MercadoLibre’s ARPU growth has been exceptional over the last two years, averaging 107%. Although its unique active buyers shrank during this time, the company’s ability to successfully increase monetization demonstrates its platform’s value for existing users. 
2. Outstanding Long-Term EPS Growth
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
MercadoLibre’s EPS grew at 60.4% compounded annual growth rate over the last three years, higher than its 40% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
3. Excellent Free Cash Flow Margin Boosts Reinvestment Potential
If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.
MercadoLibre has shown terrific cash profitability, driven by its cost-effective customer acquisition strategy that enables it to stay ahead of the competition through investments in new products rather than sales and marketing. The company’s free cash flow margin was among the best in the consumer internet sector, averaging an eye-popping 35.9% over the last two years.
Final Judgment
These are just a few reasons why we think MercadoLibre is an elite consumer internet company. After the recent drawdown, the stock trades at 16.8× forward EV/EBITDA (or $1,727 per share). Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
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