The top ecosystem stock we want to cover today is again that of Free market (WKN: A0MYNP). There is no doubt that management has built something here that is unique in Latin America. Through e-commerce via the payment service provider to smaller areas such as shipping the items, a credit service provider, an asset manager and, in the future, also a strong crypto platform.
One of these growth areas is now in the foreground. Although it is a supposedly small segment that the top management has now identified as an ideal growth opportunity.
Mercadolibre: Top ecosystem stock looking to invest more in credit
In an interview with Bloomberg, the CFO of Mercadolibre shares said credit is a lucrative growth market. Looking at the quarterly figures, we see that the volume of loans issued has grown to $2.7 billion. Up approximately $300 million sequentially.
However, it is said that the loans issued are very profitable for the top ecosystem stock. In addition, growth in this area is a significant catalyst for the growth of your own wallet, probably Mercado Pago in general. An indicator that this is something of a unique selling proposition that consumers are happy to jump on.
It is therefore only logical that the management of Mercadolibre consistently invests in this growth market. There are risks, but, as the CFO says, the management has priced them appropriately into the loans granted, also taking into account the general market situation.
These statements are yet another indicator that there’s more to the top ecosystem stock than meets the eye. But it also shows that growth does not just have to come from the two classic areas of e-commerce and payment processing. No, but that those smaller fringes definitely have a lot of potential.
Just strong!
Mercadolibre really builds a top ecosystem that’s seldom seen in many stocks. The management thinks in a long-term perspective and in the direction of building a special operational starting point. At the same time, you are actively searching for what consumers want and strategically moving in that direction. I also get the feeling that the loans and the funds used for them should contribute to profitability. This market couldn’t have bad margins in Latin America.
Overall, the management has been very successful so far. A market cap of $54 billion and a price-to-sales ratio of around 5 are two metrics that I still find to be cheap valuation metrics. Especially if the management consistently pushes the expansion of such growth opportunities.
The item Wow! This top ecosystem stock identifies a “small” market as a growth driver appeared first on The Motley Fool Deutschland.
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Vincent owns shares of Mercadolibre. The Motley Fool owns shares of shares of and recommends MercadoLibre.
Motley Fool Deutschland 2022
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