Cantor Fitzgerald lowered its price target for MercadoLibre (NASDAQ: MELI) to $2,400 from $2,750 while retaining an Overweight recommendation. The brokerage firm made the reduction despite results that topped Street estimates, reflecting concern that planned strategic investments could pressure margins in the near term.
The company reported fourth-quarter figures in which revenue and EBIT came in 3% and 2% above consensus, respectively. MercadoLibre’s revenue for the trailing twelve months reached $28.89 billion, a year-over-year increase of 39%.
Marketplaces activity remained a primary growth driver. Total gross merchandise volume rose 37% year-over-year on an ex-foreign-exchange basis, outperforming Street expectations by about 5 percentage points. Cantor Fitzgerald highlighted further acceleration in GMV in Brazil as a notable contributor to that outperformance.
On the fintech side, acquiring TPV expanded 40% year-over-year excluding foreign exchange, while the company’s credit portfolio accelerated to 90% year-over-year growth. These fintech trends supported strong payment volumes and reflected significant demand for MercadoLibre’s financial services.
However, the fourth-quarter EBIT margin came in at 10.1% and was affected by an estimated 5 to 6 percentage points of incremental spending tied to strategic initiatives. The firm specified that the investments were concentrated in marketing, credit cards and logistics.
Looking toward 2026, Cantor Fitzgerald said MercadoLibre faces multiple tailwinds across eCommerce and fintech that should support ongoing top-line strength. At the same time, the brokerage warned that continued strategic growth investments could keep margins in flux in the near term.
Despite the price-target cut, Cantor Fitzgerald said its overall constructive view on MercadoLibre’s fundamentals remains intact following the quarterly report.
Other market participants reacted to the same set of results with a range of adjustments. JPMorgan moved its rating from Neutral to Overweight and lifted its price target to $2,800 from $2,650. Raymond James trimmed its price target to $2,500 from $2,775 while maintaining a Strong Buy rating, citing concern about margin pressure. Itau BBA reiterated an Outperform rating and pointed to an impending logistics fee increase in Brazil that it said could raise MercadoLibre’s earnings per share by approximately 3% in 2026.
Financial activity and volumes also exceeded expectations in key metrics. Gross merchandise volume reached $19.8 billion, topping the Street estimate of $19.0 billion. Total payment volume registered $83.7 billion, above the estimated $78.7 billion.
Separately, the company has made personnel changes tied to its artificial intelligence expansion, laying off 119 employees in total, with 38 of those exits occurring in Brazil.
Credit markets have responded as well. Moody’s Ratings upgraded MercadoLibre to investment grade, assigning a Baa3 issuer rating and raising its assessment of the company’s senior unsecured notes. The ratings action was described as reflecting consistent improvement in credit metrics and operational performance.
The mix of strong growth, elevated strategic spending and recent operational moves has elicited varied responses from analysts and credit agencies. For investors, the immediate balance to watch will be how quickly investments aimed at longer-term expansion weigh on margins versus the pace at which top-line growth and payment volumes convert into improved profitability.