Why Mercadolibre Stock Crashed Today

Mercadolibre (NASDAQ: MELI) banal tumbled 11% done 11:10 a.m. ET Friday aft reporting mixed net for Q1 2026 past night.

Analysts had forecast the Latin American e-commerce elephantine would gain $9.37 per stock connected $8.3 cardinal successful sales. Mercadolibre bushed the income forecast with $8.8 cardinal successful revenue, but whiffed connected net -- conscionable $8.23 per share.

Mercadolibre Q1 net

Mercadolibre's income surged 49% twelvemonth implicit twelvemonth arsenic the institution worked to turn its concern now, and interest astir profits aboriginal -- to sick effect. Operating income declined 20% twelvemonth implicit twelvemonth arsenic the institution ate much of the outgo of escaped shipping successful markets specified arsenic Brazil and made different maturation investments.

These helped thrust gross merchandise measurement ("GMV" -- the worth of each the products Mercadolibre sold) up 36% globally and 38% successful Brazil successful particular, and grew the fig of Brazilian subscribers patronizing Mercadolibre by 49%.

GMV grew 28% twelvemonth implicit twelvemonth successful Mexico, 40% successful Chile, and 41% successful Argentina, excluding overseas currency fluctuations.

Free currency travel exploded higher contempt the deed to GAAP profits -- $1.8 cardinal successful Q1 2026, versus conscionable $759 cardinal successful Q1 2025.

Is this bully oregon atrocious caller for Mercadolibre?

Investors are intelligibly spooked by the falling GAAP profits, but from a escaped currency travel perspective, Mercadolibre inactive looks healthy. The institution has generated $11.8 cardinal successful affirmative FCF implicit the past 12 months -- astir 10x reported nett income nether GAAP. "Thanks" to today's sell-off that has chopped its marketplace capitalization to $84 billion, that works retired to conscionable a 7.1x price-to-free currency travel ratio connected the stock.

Now, if Mercadolibre tin conscionable fig retired a mode to turn the numbers investors care about, the banal would look ridiculously inexpensive astatine this price.

Should you bargain banal successful MercadoLibre close now?

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