MercadoLibre (MELI - Free Report) closed at $1,271.38 in the latest trading session, marking a +1.07% move from the prior day. This change outpaced the S&P 500's 0.01% gain on the day. At the same time, the Dow added 0.39%, and the tech-heavy Nasdaq lost 0.36%.
Coming into today, shares of the operator of an online marketplace and payments system in Latin America had gained 28.34% in the past month. In that same time, the Retail-Wholesale sector gained 5.61%, while the S&P 500 gained 2.55%.
Investors will be hoping for strength from MELI as it approaches its next earnings release, which is expected to be November 4, 2020. On that day, MELI is projected to report earnings of $0.08 per share, which would represent year-over-year growth of 108.25%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.01 billion, up 67.82% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $0.84 per share and revenue of $3.63 billion, which would represent changes of +122.64% and +58.11%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for MELI. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 101.81% higher. MELI is currently sporting a Zacks Rank of #1 (Strong Buy).
Valuation is also important, so investors should note that MELI has a Forward P/E ratio of 1501.96 right now. For comparison, its industry has an average Forward P/E of 43.27, which means MELI is trading at a premium to the group.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow MELI in the coming trading sessions, be sure to utilize Zacks.com.