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MercadoLibre vs. Block: Which Fintech-Driven Stock Has More Upside?
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MercadoLibre (MELI - Free Report) and Block (XYZ - Free Report) are well-known names in the growing fintech space. Both companies have gained strong attention for their digital payment solutions. While MercadoLibre is a major player in Latin America through its Mercado Pago platform, Block is known for its Cash App and Square in the United States.
Per the Mordor Intelligence report, the fintech market size is estimated at $356.73 billion in 2025. It is expected to witness a CAGR of greater than 14% over the forecast period 2025-2030, reaching $686.89 billion by 2030. Both MELI and XYZ are well-positioned to take advantage of this strong growth in the fintech market.
Let’s take a closer look at the fundamentals of the two stocks to determine which one has the greater upside potential.
The Case for MELI Stock
MercadoLibre’s fintech arm, Mercado Pago, continues to be a major growth engine in the first quarter of 2025, delivering strong performance across multiple fronts. Monthly active users surged past 64 million, growing at a rate of more than 30% year over year. This reflects not only robust user acquisition but also increased engagement across its platform.
The company’s credit portfolio expanded 75% year over year, while maintaining healthy asset quality. In Brazil, credit card first payment defaults reached an all-time low, attributed to improved scoring models and a shift toward higher-quality borrowers. Argentina also stood out, with the credit portfolio growing fourfold in U.S. dollar terms and delivering increased profitability, supported by macroeconomic stabilization.
Mercado Pago has been integrated more tightly with the broader MercadoLibre ecosystem, undergoing a visual rebrand and UX overhaul to mirror a more specialized digital banking experience.
To further strengthen its deposit base, Mercado Pago offered an attractive 120% of Brazil’s CDI rate through targeted loyalty-linked programs. To receive this rate, users must meet specific conditions, including being part of the loyalty program, placing funds into a special pot, and adhering to a contribution limit of a few thousand Brazilian Reals. This initiative helped boost awareness and reinforced Mercado Pago’s positioning as a leading digital bank in the region.
The Case for XYZ Stock
Block’s fintech business, led by Cash App, showed strength in the first quarter of 2025 despite macroeconomic headwinds. Cash App’s gross profit rose 10% year over year, and gross profit per monthly transacting active user reached $81. The company hit a key milestone in March with FDIC approval to use its in-house bank, Square Financial Services, to issue consumer loans. This move is expected to significantly improve unit economics and expand Cash App Borrow’s reach to more users across the United States. The retroactive BNPL feature, Cash App Afterpay, launched in February, also saw strong early adoption.
Block also maintained healthy underwriting metrics for Borrow, with loan durations under 30 days and consistent repayment rates. The company emphasized confidence in the company’s ability to manage risk dynamically using machine learning models that respond to real-time data. The Cash App Borrow expansion is strategically tied to its banking offerings, especially direct deposits.
However, Cash App’s gross profit came in below internal expectations due to weaker-than-expected inflows and discretionary spending during tax season. Spending categories like travel and media saw notable pullbacks. The company attributed part of this softness to a changing macro environment and revised full-year guidance accordingly, including more caution in the outlook. Block now expects 12% gross profit growth for 2025, amounting to approximately $9.96 billion. The guidance is more conservative than usual.
Despite strategic product rollouts and credit expansion, Block is still navigating slower-than-anticipated consumer spending behaviour, which has affected growth momentum. While long-term fundamentals remain intact, near-term performance remains sensitive to macroeconomic trends and evolving consumer sentiment.
Price Performance and Valuation of MELI and XYZ
Performance metrics strengthen Mercadolibre's case. Year to date, shares of MELI have rallied 47.2%, while XYZ shares have plunged 35.3%. MELI’s performance has been fueled by two strong earnings reports in a row, which came out to be better than expected. On the other hand, a challenging macroeconomic environment with the growing risk of a recession due to higher tariffs has hurt Block shares.
MELI and XYZ Stock Price Performance
Image Source: Zacks Investment Research
In terms of Price/Cash Flow, Block shares currently trade at 25.87X, higher than MELI’s 17.07X. This makes MELI significantly more attractive for a high-growth stock.
MELI and XYZ Valuation
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for MELI and XYZ?
The Zacks Consensus Estimate for MELI’s 2025 earnings is pegged at $47.92 per share, which has been revised upward by 1.7% over the past 30 days, indicating a 27.14% increase year over year. The consensus estimate for 2025 revenues is pinned at $26.53 billion, suggesting year-over-year growth of 27.67%.
The Zacks Consensus Estimate for XYZ’s 2025 earnings is pegged at $2.72 per share, which has been revised downward by 30.4% over the past 30 days, indicating a 19.29% decrease year over year. The consensus estimate for 2025 revenues is pinned at $24.98 billion, suggesting year-over-year growth of 3.54%.
MercadoLibre continues to impress with rapid fintech adoption across Latin America. In the first quarter of 2025, strong credit growth, rising monthly active users, and robust profitability drove investor confidence. Meanwhile, a disciplined cost structure and solid performance from Mercado Pago have kept momentum high.
Block, on the other hand, faces near-term challenges. While Cash App Borrow expansion and BNPL integrations show promise, macroeconomic uncertainty and weaker-than-expected first-quarter performance have forced the company to lower guidance. As MercadoLibre continues performing well, Block remains under pressure as it struggles to regain footing amid cautious consumer behaviour and valuation concerns.
Currently, MELI has a Zacks Rank #3 (Hold), making the stock a stronger pick compared with XYZ, which has a Zacks Rank #4 (Sell).
Image: Bigstock
MercadoLibre vs. Block: Which Fintech-Driven Stock Has More Upside?
MercadoLibre (MELI - Free Report) and Block (XYZ - Free Report) are well-known names in the growing fintech space. Both companies have gained strong attention for their digital payment solutions. While MercadoLibre is a major player in Latin America through its Mercado Pago platform, Block is known for its Cash App and Square in the United States.
Per the Mordor Intelligence report, the fintech market size is estimated at $356.73 billion in 2025. It is expected to witness a CAGR of greater than 14% over the forecast period 2025-2030, reaching $686.89 billion by 2030. Both MELI and XYZ are well-positioned to take advantage of this strong growth in the fintech market.
Let’s take a closer look at the fundamentals of the two stocks to determine which one has the greater upside potential.
The Case for MELI Stock
MercadoLibre’s fintech arm, Mercado Pago, continues to be a major growth engine in the first quarter of 2025, delivering strong performance across multiple fronts. Monthly active users surged past 64 million, growing at a rate of more than 30% year over year. This reflects not only robust user acquisition but also increased engagement across its platform.
The company’s credit portfolio expanded 75% year over year, while maintaining healthy asset quality. In Brazil, credit card first payment defaults reached an all-time low, attributed to improved scoring models and a shift toward higher-quality borrowers. Argentina also stood out, with the credit portfolio growing fourfold in U.S. dollar terms and delivering increased profitability, supported by macroeconomic stabilization.
Mercado Pago has been integrated more tightly with the broader MercadoLibre ecosystem, undergoing a visual rebrand and UX overhaul to mirror a more specialized digital banking experience.
To further strengthen its deposit base, Mercado Pago offered an attractive 120% of Brazil’s CDI rate through targeted loyalty-linked programs. To receive this rate, users must meet specific conditions, including being part of the loyalty program, placing funds into a special pot, and adhering to a contribution limit of a few thousand Brazilian Reals. This initiative helped boost awareness and reinforced Mercado Pago’s positioning as a leading digital bank in the region.
The Case for XYZ Stock
Block’s fintech business, led by Cash App, showed strength in the first quarter of 2025 despite macroeconomic headwinds. Cash App’s gross profit rose 10% year over year, and gross profit per monthly transacting active user reached $81. The company hit a key milestone in March with FDIC approval to use its in-house bank, Square Financial Services, to issue consumer loans. This move is expected to significantly improve unit economics and expand Cash App Borrow’s reach to more users across the United States. The retroactive BNPL feature, Cash App Afterpay, launched in February, also saw strong early adoption.
Block also maintained healthy underwriting metrics for Borrow, with loan durations under 30 days and consistent repayment rates. The company emphasized confidence in the company’s ability to manage risk dynamically using machine learning models that respond to real-time data. The Cash App Borrow expansion is strategically tied to its banking offerings, especially direct deposits.
However, Cash App’s gross profit came in below internal expectations due to weaker-than-expected inflows and discretionary spending during tax season. Spending categories like travel and media saw notable pullbacks. The company attributed part of this softness to a changing macro environment and revised full-year guidance accordingly, including more caution in the outlook. Block now expects 12% gross profit growth for 2025, amounting to approximately $9.96 billion. The guidance is more conservative than usual.
Despite strategic product rollouts and credit expansion, Block is still navigating slower-than-anticipated consumer spending behaviour, which has affected growth momentum. While long-term fundamentals remain intact, near-term performance remains sensitive to macroeconomic trends and evolving consumer sentiment.
Price Performance and Valuation of MELI and XYZ
Performance metrics strengthen Mercadolibre's case. Year to date, shares of MELI have rallied 47.2%, while XYZ shares have plunged 35.3%. MELI’s performance has been fueled by two strong earnings reports in a row, which came out to be better than expected. On the other hand, a challenging macroeconomic environment with the growing risk of a recession due to higher tariffs has hurt Block shares.
MELI and XYZ Stock Price Performance
Image Source: Zacks Investment Research
In terms of Price/Cash Flow, Block shares currently trade at 25.87X, higher than MELI’s 17.07X. This makes MELI significantly more attractive for a high-growth stock.
MELI and XYZ Valuation
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for MELI and XYZ?
The Zacks Consensus Estimate for MELI’s 2025 earnings is pegged at $47.92 per share, which has been revised upward by 1.7% over the past 30 days, indicating a 27.14% increase year over year. The consensus estimate for 2025 revenues is pinned at $26.53 billion, suggesting year-over-year growth of 27.67%.
MercadoLibre, Inc. Price and Consensus
MercadoLibre, Inc. price-consensus-chart | MercadoLibre, Inc. Quote
The Zacks Consensus Estimate for XYZ’s 2025 earnings is pegged at $2.72 per share, which has been revised downward by 30.4% over the past 30 days, indicating a 19.29% decrease year over year. The consensus estimate for 2025 revenues is pinned at $24.98 billion, suggesting year-over-year growth of 3.54%.
Block, Inc. Price and Consensus
Block, Inc. price-consensus-chart | Block, Inc. Quote
Conclusion
MercadoLibre continues to impress with rapid fintech adoption across Latin America. In the first quarter of 2025, strong credit growth, rising monthly active users, and robust profitability drove investor confidence. Meanwhile, a disciplined cost structure and solid performance from Mercado Pago have kept momentum high.
Block, on the other hand, faces near-term challenges. While Cash App Borrow expansion and BNPL integrations show promise, macroeconomic uncertainty and weaker-than-expected first-quarter performance have forced the company to lower guidance. As MercadoLibre continues performing well, Block remains under pressure as it struggles to regain footing amid cautious consumer behaviour and valuation concerns.
Currently, MELI has a Zacks Rank #3 (Hold), making the stock a stronger pick compared with XYZ, which has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.