The Market Keeps Punishing MercadoLibre for Growing Too Fast. Here's Why That's Exactly When to Buy.
MercadoLibre is getting punished for investing heavily in growth, but if credit quality holds, the market could be underestimating the long-term payoff.
Overview
MercadoLibre's (NASDAQ: MELI) stock price recently closed above $1,950, still roughly 26% below its 52-week high, and the pattern this year has been almost comic: The company reports record revenue and beats estimates, but the stock drops.
In May, MercadoLibre posted its fastest revenue growth in four years, and the stock fell 12.7% the next day. In August, it crossed $10 billion in quarterly revenue for the first time and beat on both lines, but shares dropped as much as 9% before settling down by about 4.5%. Thirty consecutive quarters of 30% or better growth ... and the market keeps flinching.
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Originally published at www.fool.com.