Down 24% This Year, Is MercadoLibre (MELI) an Obvious Growth Stock to Buy in November?

MercadoLibre (NASDAQ: MELI) is often described as a cross between Amazon.com and PayPal, as it encompasses both a dominant online marketplace (MercadoLibre) and a major "fintech" business (Mercado Pago). You might not have heard of it, though, as it's focused on the Latin American market, which is rather... huge. According to one report, the retail market is valued at $2.0 trillion in 2026 and is expected to reach $3.4 trillion by 2034.

So why is the stock down, and is it worth considering for your portfolio? Let's see.

Image source: The Motley Fool.

Meet MercadoLibre

Founded in 1999 and headquartered in Montevideo, Uruguay, MercadoLibre sports a market value near $76 billion (as of Nov. 6). It's active in 18 countries and was recently delivering 3.2 billion items annually. It has 136 million unique buyers and 93 million monthly active users (both numbers as of the third quarter).

What are MercadoLibre's challenges?

The stock has been volatile in recent years:

Source: Morningstar.com, as of Nov. 5, 2026.

That can make plenty of investors skittish, but remember that while the average annual gain over the past three years is just 3.31%, it's 21% over the past 15 years. It can help to be a long-term investor.

Investors worried about MercadoLibre are concerned about factors such as:

• Growing competition in the fintech realm.
• Potential competition from outside retail giants.
• Geopolitical tensions in Latin America, such as in Brazil, where the more business-friendly candidate didn't win the presidential election.
• Shrinking profit margins.

Should you invest in MercadoLibre?

Those are quite reasonable concerns, but the company has a lot going for it, as well. And some of those concerns are not as bad as they may seem. For example, the shrinking profit margins are partly due to the company extending more free shipping and credit to shoppers. That can build loyalty and can help it compete against rivals and would-be rivals. It's also due to the company investing in expanding its fulfillment capabilities, which can pay off with better service for customers.

Here are some reasons to be optimistic:

• Third-quarter revenue surged 45% year over year.
• Engagement is growing among its customers, with items bought per buyer rising 12% year over year, as of the third quarter.
• The fintech business is performing well, with monthly active users up 29% and assets under management up 67%. (Mercado Pago is now the largest digital bank in Mexico.)
• The Mercado Ads advertising business saw revenue jump 58% year over year in the third quarter.
• The ecosystem strategy is working, with the number of customers using both the marketplace and fintech platforms growing by 33%.

Meanwhile, the stock is appealingly priced at recent levels, with a forward-looking price-to-earnings (P/E) ratio of 28, well below the five-year average of 50, and a recent price-to-sales ratio of 2.0, well below the five-year average of 4.8.

Long-term investors seeking businesses with solid growth potential, especially those looking for investments based outside the U.S. for diversification, should take a closer look at MercadoLibre.

Selena Maranjian has positions in Amazon and MercadoLibre. The Motley Fool has positions in and recommends Amazon, MercadoLibre, and PayPal. The Motley Fool recommends the following options: short December 2026 $62.50 calls on PayPal. The Motley Fool has a disclosure policy.