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Mercadolibre, Inc. Message Board

  • Beck446 Beck446 Mar 11, 2010 3:51 PM Flag

    Q4 Results were Disappointing

    Worrying signs in this quarter's results. Segment analysis:

    Q2: $12.6 million
    Q3: $15.5 million
    Q4: $16.1 million
    Increase in Q4 over Q3: 3.8%

    Q2: $3.3 million
    Q3: $3.7 million
    Q4: $3.8 Million
    Increase: 4.6%

    Q2: $5.5 million
    Q3: $6.6 million
    Q4: $6.7 million
    Increase: 1.3%

    This shows that core marketplace revenue is slowing. GMV actually was lower in Q4 than Q3 (partially because of the VZ effect).

    Keep in mind that Q4 results should have been helped by: (1) LA currencies were much stronger during Q4 than Q3 and (2) Christmas buying season.

    I am very disappointed with these trends. Lower take rates doesn't explain the story either since GMV went down Q over Q.

    We will have a much better idea if this was a blip or a new trend after next Q's report.

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    • S&P500 target of 1220. The 200-WEEK simple MA area.

    • the quick selloff to under 45 couple days ago suggests there are some itchy fingers among meli holders

      BUT: although VIX is nearing 2-plus year low (at the trough of its recent oscillations, suggesting we're due for some downside and increased volatility) the bull mkt before crash VIX reached 11.

      and although SPX is stretched about 70 points above its 100 day simple ma, it got stretched over 100 points above it several times in climb from march 09 lows and, when pullbacks did occur, only pulled back to 50-70 points above 100 day

      so- and this is not an argument I'm strongly in favor of, but one takes what the market gives- the bull mkt starting march 09 looks back on track in which case shorts will get stopped out

      I've got limit GTC buy orders at lower prices just in case a buy ooportunity does come along though

    • don't understand what you own.

      Are you telling me Portugal site won't drive the numbers higher?

      Are you telling me when mobile launches it won't drive the numbers higher?

      Go short something else. Or go fool somebody else.

      Or even better, sell if you interpret the facts so negatively and the numbers are going "down."

    • MELI's growth is already slowing.

      As you accurately point out, there are plenty of headwinds in South America now.

      The stock is trying to go down, but the broader market's sugar high is holding everything up.

      A couple of down days in the market (is there such a thing?) will drive MELI into the low $40's.

    • I can't find numbers but as craigslist has an effect on eBay, it wouldn't be surprising that OLX (rapidly growing; global; and just recently became the largest online free classifieds provider in Brazil) started denting MELI's growth. Maybe the new alternative OLX is drawing away some users from MELI, and that contributed to the shortfall of revenue and GMV and slowing growth of new users in Q4?

      OLX is like an "improved" craigslist with a mobile interface (which MELI lacks) run by the visionary entrepreneur who started De Remate, the main previous competitor to MELI that MELI bought

      (OLX coincidentally offers an online payments option= the growing, Paypal-like Dineromail- that could draw users away from PAGO as well. All the more reason MELI should hurry up and roll-out their expanded version of PAGO payments system in Brazil)

      MELI's growth will slow if emerging competition like OLX takes market share of online shopping or payments. Luckily growth of online retail in latin america is forecast to grow robustly for several years which will undoubtedly continue to fuel MELI's growth. Plus, management owns a large percent of shares, they are focused on growing their business, and the float is small. So still a good growth story, albeit with weakening fundamentals and MOAT

    • All excellent points, which is why I remain on the counter trend trade. But don't ask me how that's going, as I started that trade today.

      What I really want to know is why this market is being bought at these levels. I mean, I've never ever seen in all my years of trading a market sell off like it did in January for about 2 weeks, only to come back through all that supply, and close right at 1150 today (S&P), without at the MINIMUM, retesting that low from January....or is that yet to come?

      Unless this is the biggest bull trap in history (there certainly were enough bear traps this past year), I can't figure out why MELI continues to go up....


      • 1 Reply to dardaaajo
      • People are desperate to recoup losses from the plunge. Many are still on the sidelines, so there is much cash waiting to get in still. Its a jobless recovery.
        And we may be heading for a "market bubble". But earnings are improving.
        Main street is still a disaster. We are in unknown territory. The Boomers that have been driving this economy for decades are in their 60's now..wanting to retire. Medicare is fractured, SS the same. But the EBAY of Latin America will go on to $200 PPS. Why?? Because I command it to.

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