2 Brilliant Growth Stocks to Buy Before They Soar 75% and 150% in 2026, According to Certain Wall Street Analysts

Shares of The Trade Desk (NASDAQ: TTD) and MercadoLibre (NASDAQ: MELI) have declined 71% and 24%, respectively, from their record highs. But Wall Street analysts generally think the stocks are undervalued, and some anticipate substantial gains in the next year.

• Among 42 analysts, The Trade Desk has a median target price of $60 per share, implying 53% upside from the current share price of $39. The highest target of $98 per share comes from Brian Pitz at BMO Capital, and it implies 150% upside.
• Among 27 analysts, MercadoLibre has a median target price of $2,842 per share, which implies 42% upside from its current share price of $1,999. The highest target of $3,500 per share comes from Hector Maya at Scotiabank, and it implies 75% upside.

Here's what investors should know.

Image source: Getty Images.

The Trade Desk: 150% upside implied by the Street-high target price

The Trade Desk operates the largest demand-side platform (DSP) for the open internet. A DSP is ad tech software that helps media buyers plan, measure, and optimize digital campaigns, and the open internet refers to websites, applications, and streaming services not controlled by technology giants like Alphabet, Meta Platforms, and Amazon.

The Trade Desk has an important advantage in its independent business model, meaning the company does not own media content that could bias ad spending on its platform. Competitors like Alphabet, Meta Platforms, and Amazon have a clear incentive to steer media buyers toward their own advertising inventory, which creates a conflict of interest.

Also, publishers (i.e., companies with ad inventory to sell) are less likely to share data with those technology companies because they are competitors. In turn, The Trade Desk often has better measurement capabilities across the open internet. The company is particularly dominant in connected TV (CTV) advertising, the fastest-growing vertical in the industry.

Importantly, The Trade Desk stock has fallen 71% from its high due to concerns about slowing growth amid increased competition with Amazon, which recently struck deals to include CTV inventory from Netflix and Roku on its own DSP. Furthermore, Amazon is reportedly undercutting The Trade Desk's fees by a substantial margin in an effort to take market share across the open internet.

Nevertheless, I think the market is too pessimistic. Consumers spend more time browsing the open internet than they spend in closed ecosystems, and The Trade Desk is likely to maintain its leadership position in open internet advertising because its independence often means better data, targeting, and measurement capabilities.

The Trade Desk currently trades at 45 times earnings, a reasonable valuation for a company whose earnings are forecast to grow at 20% annually during the next three years. Investors should consider buying a small position today.

MercadoLibre: 75% upside implied by the Street-high target price

MercadoLibre runs the largest online marketplace in Latin America, a region where e-commerce penetration is approximately half that of the United States. The company benefits from a powerful network effect whereby each buyer creates incremental value for each seller and vice versa. Growth in active buyers on the marketplace accelerated in the last quarter.

MercadoLibre has also reinforced its leadership with adjacent services for advertising, logistics, and payments. In fact, the company accounts for over half of retail ad spending in Latin America, and it owns the "fastest and most extensive delivery network in the region." The company also has the largest fintech platform in Mexico and Argentina, and the second largest in Brazil, based on monthly active users.

MercadoLibre reported reasonably good financial results in the third quarter, though it did miss estimates on the bottom line. Revenue rose 39% to $7.4 billion, the 27th consecutive quarter in which growth has exceeded 30% due to particularly strong results in the fintech segment. However, generally accepted accounting principles (GAAP) net income increased just 6% to $8.32 per diluted share due to investments in shipping and expansion of its credit card business.

While those strategic investments hurt profits in the near term, they are bearing fruit that should drive growth in the long run. According to CFO Martin de los Santos,

The recent reduction in free shipping thresholds in Brazil has already delivered strong results, with both [gross merchandise volume] and items sold accelerating in the quarter. We also saw strong growth in buyers, with improved conversion rates and frequency of purchase.

Going forward, Wall Street expects MercadoLibre's earnings to increase at 32% annually over the next three years. That makes the current valuation of 49 times earnings look quite reasonable. With shares 24% below their record high, now is a good time to buy.

Trevor Jennewine has positions in Amazon, MercadoLibre, Roku, and The Trade Desk. The Motley Fool has positions in and recommends Alphabet, Amazon, MercadoLibre, Meta Platforms, Netflix, Roku, and The Trade Desk. The Motley Fool recommends Bank Of Nova Scotia. The Motley Fool has a disclosure policy.