Bank of America Securities has maintained its buy recommendation for MercadoLibre stock while flagging a stretch of near-term margin pressure tied to the company’s aggressive investments across several business lines. The firm’s analysis centers on the long-term profit potential of MercadoLibre’s credit card offering even as the unit weighs on 2026 results.
MercadoLibre expanded its credit card portfolio rapidly in the first quarter of 2026, more than doubling balances year-over-year to $6.6 billion. That portfolio now accounts for roughly 45% of the company’s total loan book. Growth in credit card monthly active users outpaced the broader Mercado Pago base: card MAUs rose 68% year-over-year compared with a 29% increase in total Mercado Pago monthly active users.
Despite the fast expansion, Bank of America analyst Robert E. Ford Aguilar noted the company’s share of credit card balances remains small in key markets. As of March 2026, MercadoLibre represented about 3.4% of Brazil’s industry credit card balances and around 2.5% in Mexico, indicating substantial room to scale.
On the profitability trajectory, BofA modeled an EBIT loss from the credit card segment of $443 million in 2026, which the firm said would subtract 1.1 percentage points from consolidated margins that year. The analyst expects the credit card business to reach a breakeven EBIT position in 2028, and to produce $1.5 billion of EBIT by 2030 - a level BofA calculates would improve consolidated margins by 2.2 percentage points versus the 2026 baseline.
BofA highlighted an industry timing nuance: credit card operations often require 12 to 18 months to move from losses to net interest margin positive performance because of upfront provisioning requirements. That dynamic helps explain the expected near-term drag before the later margin recovery.
MercadoLibre has also rolled out its credit card in Argentina, where the company reported 19.9 million daily active users of the Pago app as of April 2026, compared with 12.9 million in Brazil. Aguilar said MercadoLibre’s stronger foothold and lower customer acquisition costs in Argentina should support a quicker portfolio ramp as inflation in the country has eased. At the same time, credit penetration in Argentina remains muted, a legacy of past inflation and macroeconomic volatility.
Bank of America kept its $2,400 price target on MercadoLibre, applying a sum-of-the-parts approach. The firm values commerce at 0.6 times 2027 gross merchandise value and assigns fintech revenue streams 0.2 times 2027 off-platform total payments value in its valuation framework. The maintained price target and buy rating reflect the bank’s view that the company’s credit card expansion, while margin-accretive only over time, will be a material contributor to long-term profitability.
Summary - Bank of America reiterates buy on MercadoLibre, citing rapid credit card portfolio growth to $6.6 billion in Q1 2026 and forecasting a path from a 2026 EBIT loss to breakeven in 2028 and sizable EBIT by 2030.