Mercadolibre hosts online commerce platforms in Latin America. It offers MercadoLibre Marketplace, an automated online e-commerce service for businesses and individuals to list items and conduct their sales and purchases online in a fixed-price or auction-based format. The company was founded in 1999 and is based in Vicente Lopez, Argentina.
MELI Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Mercadolibre Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Mercadolibre Inc ranked in the 19th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 62.83%. In terms of the factors that were most noteworthy in this DCF analysis for MELI, they are:
The business' balance sheet suggests that 4% of the company's capital is sourced from debt; this is greater than only 11.51% of the free cash flow producing stocks we're observing.
Mercadolibre Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -0.63. This coverage rate is greater than that of merely 13.9% of stocks we're observing for the purpose of forecasting via discounted cash flows.
As a business, Mercadolibre Inc experienced a tax rate of about 277% over the past twelve months; relative to its sector (Technology), this tax rate is higher than 99.08% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Mercadolibre Inc? See AZPN, BRKS, NSIT, SMTC, and SNCR.