Eagle Capital Management, LLC on MercadoLibre, Inc.
Thesis
MercadoLibre is the largest component of Eagle's consumer-platform allocation and is the leading e-commerce and fintech company in Latin America. E-commerce penetration in the region remains far below U.S. levels, providing a long runway for growth while recent revenue growth exceeded 40%. Eagle believes the market is overly focused on near-term earnings revisions and is misinterpreting deliberate margin investment as structural weakness, allowing the firm to establish the position at an attractive valuation.
“we’re thrilled with this approach, which both builds value and has enabled Eagle to establish an attractively priced position.”
Key risks
- Deliberate investment is suppressing near-term margins and can create negative earnings revisions.