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MercadoLibre (MELI) Soars 5.7%: Is Further Upside Left in the Stock?

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MercadoLibre (MELI - Free Report) shares rallied 5.7% in the last trading session to close at $1,082.92. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 22.7% gain over the past four weeks.

MercadoLibre extended its rally, driven by its strength in the commerce and fintech businesses. Robust product offerings and credit portfolio expansion are respectively driving the company’s commerce and fintech revenues. This in turn, is aiding MercadoLibre in winning investors’ confidence.

This operator of an online marketplace and payments system in Latin America is expected to post quarterly earnings of $2.11 per share in its upcoming report, which represents a year-over-year change of +329.4%. Revenues are expected to be $2.94 billion, up 38.1% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For MercadoLibre, the consensus EPS estimate for the quarter has been revised 9.7% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on MELI going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

MercadoLibre is a member of the Zacks Internet - Commerce industry. One other stock in the same industry, 1stdibs.com (DIBS - Free Report) , finished the last trading session 2.6% higher at $5.93. DIBS has returned 12.2% over the past month.

1stdibs' consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.22. Compared to the company's year-ago EPS, this represents a change of -4.8%. 1stdibs currently boasts a Zacks Rank of #2 (Buy).


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