We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
MercadoLibre vs Amazon: Which E-Commerce Giant Stock Has More Upside?
Read MoreHide Full Article
Key Takeaways
MELI's Latin American focus heightens exposure to credit, currency and competitive pressures.
AMZN gains stability from global diversification, dense logistics and expanding high-margin advertising.
MELI's falling EPS estimates contrast with AMZN's rising outlook, widening their earnings gap.
MercadoLibre (MELI - Free Report) and Amazon (AMZN - Free Report) represent two distinct yet compelling approaches to capturing the e-commerce growth opportunity across the Americas. Amazon operates as a vertically integrated marketplace giant with diverse revenue streams spanning retail, cloud computing and digital advertising, while MercadoLibre focuses on dominating Latin American e-commerce through its integrated ecosystem combining marketplace operations, proprietary logistics infrastructure and the Mercado Pago fintech platform.
The comparison becomes relevant as both scale fulfilment networks, enhance payment infrastructure and expand advertising capabilities. Third-quarter 2025 results point to their contrasting operating models. Amazon maintained margin discipline while investing aggressively in logistics and AI, whereas MercadoLibre faced sustained margin pressure amid rising competition and regional macro volatility. These diverging growth paths and profitability profiles make it essential to assess which platform offers stronger long-term value creation as the shift from physical to e-commerce accelerates.
Let's delve deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for MELI
MercadoLibre’s marketplace operations continue to face structural headwinds tied to its concentration in politically and economically unstable Latin American markets. Third-quarter results underscored these vulnerabilities as election-driven turbulence in Argentina slowed GMV and payment activity while compressing margins. Revenue grew 39% year over year, yet earnings fell short of estimates as contribution margins weakened, highlighting how quickly macro swings can disrupt MELI’s operating pace and undermine visibility.
Logistics remains a critical pressure point. MELI is expanding fulfillment capacity, but network productivity is not improving fast enough to offset heavier shipping subsidies, elevated marketing intensity and rising competitive pressure in Brazil and Mexico. The reduction of Brazil’s free-shipping threshold from BRL 79 to BRL 19 lifted volumes but reinforced MELI’s reliance on high-cost levers to defend share. These dynamics continue to weigh on unit economics and limit MELI’s ability to achieve the density and efficiency advantages enjoyed by larger global peers.
Fintech growth adds meaningful scale but introduces additional risk. Mercado Pago’s lending portfolio expanded 83% year over year, yet the mix remains concentrated in higher-risk consumer credit and credit cards. Net interest margin after losses declined sequentially as Argentine funding costs rose and younger cohorts diluted returns. This growth deepens MELI’s exposure to credit and currency cycles that can shift abruptly in emerging markets.
Advertising remains an underdeveloped monetization layer. Despite third-party sellers accounting for 62% of units sold, MELI’s ad revenues trail materially behind more mature platforms, limiting its ability to diversify margins at a time when reinvestment demands remain high. The Zacks Consensus Estimate for fourth-quarter 2025 EPS is pegged at $11.85, indicating a 6.03% year-over-year decline, while estimates have fallen 18.7% over the past 30 days, reflecting persistent uncertainty around margin recovery and earnings durability.
Amazon continues to benefit from the strength of its global marketplace and the stability of operating across mature, diversified economies. Third-quarter revenues grew 13% year over year to $180.1 billion as retail, cloud and advertising demand remained resilient. Unlike MELI, which is tied to macro-sensitive Latin American markets, Amazon’s geographic and business-line diversification provides steadier cash flows and lower earnings volatility. Retail margins have strengthened across North America and internationally, reflecting the scalability of Amazon’s regionalised fulfilment network.
Logistics remains a core advantage. Amazon’s fulfilment and delivery ecosystem has reached a density and maturity that continues to widen efficiency gaps. Inventory placement and routing improvements reduced inbound lead times by nearly four days year over year, improving procurement speed and working-capital efficiency. Delivery speeds are on track to hit record levels for Prime members, supported by expanded regionalization and automation. This scale-driven efficiency gives Amazon cost leverage that emerging-market-focused competitors struggle to replicate.
Amazon’s payments and checkout layers are gaining momentum through AI-driven enhancements. Rufus, the generative AI shopping assistant, is driving higher conversion and rapid adoption, while Add to Delivery streamlines repeat purchases. These features increase customer stickiness and strengthen the value of Amazon’s integrated marketplace and payments ecosystem.
Advertising remains a standout earnings driver. Revenues grew 22% in the latest quarter, supported by richer targeting capabilities and expanded partnerships across Netflix, Roku and Spotify. The Zacks Consensus Estimate for fourth-quarter advertising revenues is pegged at $21.03 billion, up 21.6% year over year, reflecting the durability of this high-margin stream.
The Zacks Consensus Estimate for fourth-quarter 2025 EPS is pegged at $1.97, indicating a 5.9% year-over-year increase, while estimates have improved 4.2% over the past 30 days—reinforcing confidence in Amazon’s strengthening profitability and long-term growth outlook.
In the year-to-date period (YTD), AMZN shares are up 1.4%, while MELI shares have appreciated 21.4%. MELI’s stronger move reflects enthusiasm around its commerce and fintech momentum, but rising costs, credit exposure and regional volatility make the rally look less secure. AMZN’s steadier performance aligns with a more diversified business, improving retail economics and a more predictable earnings profile, which investors appear to favour in the current environment.
MELI vs. AMZN YTD PERFORMANCE
Image Source: Zacks Investment Research
Valuation-wise, both MELI and AMZN’s shares appear stretched, as suggested by a Value Score of D. MELI trades at 2.96x forward 12-month Price/Sales, a premium that looks difficult to sustain given margin pressure, rising credit exposure and limited earnings visibility. AMZN trades at 3.18x, a richer multiple that is more defensible given improving retail profitability, the growing leverage of its scaled logistics network and continued momentum in high-margin advertising and AI-driven commerce initiatives, all of which support a more resilient earnings outlook.
MELI vs. AMZN- Price/Sales (F12M)
Image Source: Zacks Investment Research
Conclusion
Amazon’s exposure to stable global markets, stronger earnings momentum and more defensible valuation make it the comparatively steadier opportunity. MELI’s growth remains solid but more vulnerable to rising costs, credit risk and regional volatility, which clouds near-term profitability. With clearer profitability drivers and a more resilient operating structure, Amazon, which holds a Zacks Rank #2 (Buy), stands out as the more compelling opportunity. Investors may consider accumulating AMZN while taking a more cautious stance on MELI, which carries a Zacks Rank #4 (Sell).
Image: Bigstock
MercadoLibre vs Amazon: Which E-Commerce Giant Stock Has More Upside?
Key Takeaways
MercadoLibre (MELI - Free Report) and Amazon (AMZN - Free Report) represent two distinct yet compelling approaches to capturing the e-commerce growth opportunity across the Americas. Amazon operates as a vertically integrated marketplace giant with diverse revenue streams spanning retail, cloud computing and digital advertising, while MercadoLibre focuses on dominating Latin American e-commerce through its integrated ecosystem combining marketplace operations, proprietary logistics infrastructure and the Mercado Pago fintech platform.
The comparison becomes relevant as both scale fulfilment networks, enhance payment infrastructure and expand advertising capabilities. Third-quarter 2025 results point to their contrasting operating models. Amazon maintained margin discipline while investing aggressively in logistics and AI, whereas MercadoLibre faced sustained margin pressure amid rising competition and regional macro volatility. These diverging growth paths and profitability profiles make it essential to assess which platform offers stronger long-term value creation as the shift from physical to e-commerce accelerates.
Let's delve deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for MELI
MercadoLibre’s marketplace operations continue to face structural headwinds tied to its concentration in politically and economically unstable Latin American markets. Third-quarter results underscored these vulnerabilities as election-driven turbulence in Argentina slowed GMV and payment activity while compressing margins. Revenue grew 39% year over year, yet earnings fell short of estimates as contribution margins weakened, highlighting how quickly macro swings can disrupt MELI’s operating pace and undermine visibility.
Logistics remains a critical pressure point. MELI is expanding fulfillment capacity, but network productivity is not improving fast enough to offset heavier shipping subsidies, elevated marketing intensity and rising competitive pressure in Brazil and Mexico. The reduction of Brazil’s free-shipping threshold from BRL 79 to BRL 19 lifted volumes but reinforced MELI’s reliance on high-cost levers to defend share. These dynamics continue to weigh on unit economics and limit MELI’s ability to achieve the density and efficiency advantages enjoyed by larger global peers.
Fintech growth adds meaningful scale but introduces additional risk. Mercado Pago’s lending portfolio expanded 83% year over year, yet the mix remains concentrated in higher-risk consumer credit and credit cards. Net interest margin after losses declined sequentially as Argentine funding costs rose and younger cohorts diluted returns. This growth deepens MELI’s exposure to credit and currency cycles that can shift abruptly in emerging markets.
Advertising remains an underdeveloped monetization layer. Despite third-party sellers accounting for 62% of units sold, MELI’s ad revenues trail materially behind more mature platforms, limiting its ability to diversify margins at a time when reinvestment demands remain high. The Zacks Consensus Estimate for fourth-quarter 2025 EPS is pegged at $11.85, indicating a 6.03% year-over-year decline, while estimates have fallen 18.7% over the past 30 days, reflecting persistent uncertainty around margin recovery and earnings durability.
MercadoLibre, Inc. Price and Consensus
MercadoLibre, Inc. price-consensus-chart | MercadoLibre, Inc. Quote
The Case for AMZN
Amazon continues to benefit from the strength of its global marketplace and the stability of operating across mature, diversified economies. Third-quarter revenues grew 13% year over year to $180.1 billion as retail, cloud and advertising demand remained resilient. Unlike MELI, which is tied to macro-sensitive Latin American markets, Amazon’s geographic and business-line diversification provides steadier cash flows and lower earnings volatility. Retail margins have strengthened across North America and internationally, reflecting the scalability of Amazon’s regionalised fulfilment network.
Logistics remains a core advantage. Amazon’s fulfilment and delivery ecosystem has reached a density and maturity that continues to widen efficiency gaps. Inventory placement and routing improvements reduced inbound lead times by nearly four days year over year, improving procurement speed and working-capital efficiency. Delivery speeds are on track to hit record levels for Prime members, supported by expanded regionalization and automation. This scale-driven efficiency gives Amazon cost leverage that emerging-market-focused competitors struggle to replicate.
Amazon’s payments and checkout layers are gaining momentum through AI-driven enhancements. Rufus, the generative AI shopping assistant, is driving higher conversion and rapid adoption, while Add to Delivery streamlines repeat purchases. These features increase customer stickiness and strengthen the value of Amazon’s integrated marketplace and payments ecosystem.
Advertising remains a standout earnings driver. Revenues grew 22% in the latest quarter, supported by richer targeting capabilities and expanded partnerships across Netflix, Roku and Spotify. The Zacks Consensus Estimate for fourth-quarter advertising revenues is pegged at $21.03 billion, up 21.6% year over year, reflecting the durability of this high-margin stream.
The Zacks Consensus Estimate for fourth-quarter 2025 EPS is pegged at $1.97, indicating a 5.9% year-over-year increase, while estimates have improved 4.2% over the past 30 days—reinforcing confidence in Amazon’s strengthening profitability and long-term growth outlook.
Amazon.com, Inc. Price and Consensus
Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote
Price Performance and Valuation of MELI and AMZN
In the year-to-date period (YTD), AMZN shares are up 1.4%, while MELI shares have appreciated 21.4%. MELI’s stronger move reflects enthusiasm around its commerce and fintech momentum, but rising costs, credit exposure and regional volatility make the rally look less secure. AMZN’s steadier performance aligns with a more diversified business, improving retail economics and a more predictable earnings profile, which investors appear to favour in the current environment.
MELI vs. AMZN YTD PERFORMANCE
Image Source: Zacks Investment Research
Valuation-wise, both MELI and AMZN’s shares appear stretched, as suggested by a Value Score of D. MELI trades at 2.96x forward 12-month Price/Sales, a premium that looks difficult to sustain given margin pressure, rising credit exposure and limited earnings visibility. AMZN trades at 3.18x, a richer multiple that is more defensible given improving retail profitability, the growing leverage of its scaled logistics network and continued momentum in high-margin advertising and AI-driven commerce initiatives, all of which support a more resilient earnings outlook.
MELI vs. AMZN- Price/Sales (F12M)
Image Source: Zacks Investment Research
Conclusion
Amazon’s exposure to stable global markets, stronger earnings momentum and more defensible valuation make it the comparatively steadier opportunity. MELI’s growth remains solid but more vulnerable to rising costs, credit risk and regional volatility, which clouds near-term profitability. With clearer profitability drivers and a more resilient operating structure, Amazon, which holds a Zacks Rank #2 (Buy), stands out as the more compelling opportunity. Investors may consider accumulating AMZN while taking a more cautious stance on MELI, which carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.