The Market May Be Focusing on the Wrong Metric at MercadoLibre
MercadoLibre's narrowing margins have grabbed investors' attention, but they may not tell the full story.
Overview
When MercadoLibre (NASDAQ: MELI) reported another quarter of strong revenue growth, investors quickly shifted their attention elsewhere:
Operating margin narrowed. Logistics costs increased. Shipping subsidies remained elevated. These became investors' focus instead of the headline growth of 49%.
Details
The market's concern was straightforward: MercadoLibre's growth is becoming more expensive. That's a fair concern, since profitability ultimately determines shareholder returns. But it also raises a more important question:
Source
Originally published at www.fool.com.
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