$MELI Bearish Divergences in Mercadolibre Inc. Caution needed.
Mercadolibre in our opinion is running higher on FOMO and sentiment, fundamentals and technicals have been moved to the one side, if in a long position this is a good moment to reflect on the huge gains in 2019 and the risk involved in holding the stock for to long, " be fearful when others are greedy"
Given the fact that the stock price is well above the average analysts estimate , those analysts will now be forced to re rate the stock, while some will be bullish we believe downgrades should be expected given the velocity of the move since December lows.
TODAYS QUESTIONABLE UPGRADE
Barclays analyst Deepak Mathivanan raised his price target for MercadoLibre to $730 from $615 ahead of the company's Q2 results and reiterates an Overweight rating on the shares. The company's financials are likely to see "meaningful tailwinds from easing comps in its e-commerce business and incremental consumer adoption of fintech offerings on payments over the next few quarters, Mathivanan tells investors in a research note. He expects MercadoLibre's gross merchandise volume growth to "accelerate nicely" in Q2 and "track at healthy levels" in the second half of 2019.
Technically The chart of MELI is showing bearish divergences for some time, this can not be ignored, correction are healthy and needed for long term stability.
AVERAGE ANALYSTS PRICE TARGET $594
AVERAGE ANALYSTS RECOMMENDATION OVERWEIGHT
SHORT INTEREST 4.5%
COMPANY PROFILE
MercadoLibre, Inc. engages in the provision of online commerce platform with focus on e-commerce and its related services. It operates through the following geographical segments: Brazil, Argentina, Mexico, Venezuela, and Other Countries. The firm provides users a mechanism for buying, selling and paying as well as collecting, generating leads, and comparing lists through e-commerce transactions. The company was founded by Marcos Eduardo Galperin on October 15, 1999 and is headquartered in Buenos Aires, Argentina.
Given the fact that the stock price is well above the average analysts estimate , those analysts will now be forced to re rate the stock, while some will be bullish we believe downgrades should be expected given the velocity of the move since December lows.
TODAYS QUESTIONABLE UPGRADE
Barclays analyst Deepak Mathivanan raised his price target for MercadoLibre to $730 from $615 ahead of the company's Q2 results and reiterates an Overweight rating on the shares. The company's financials are likely to see "meaningful tailwinds from easing comps in its e-commerce business and incremental consumer adoption of fintech offerings on payments over the next few quarters, Mathivanan tells investors in a research note. He expects MercadoLibre's gross merchandise volume growth to "accelerate nicely" in Q2 and "track at healthy levels" in the second half of 2019.
Technically The chart of MELI is showing bearish divergences for some time, this can not be ignored, correction are healthy and needed for long term stability.
AVERAGE ANALYSTS PRICE TARGET $594
AVERAGE ANALYSTS RECOMMENDATION OVERWEIGHT
SHORT INTEREST 4.5%
COMPANY PROFILE
MercadoLibre, Inc. engages in the provision of online commerce platform with focus on e-commerce and its related services. It operates through the following geographical segments: Brazil, Argentina, Mexico, Venezuela, and Other Countries. The firm provides users a mechanism for buying, selling and paying as well as collecting, generating leads, and comparing lists through e-commerce transactions. The company was founded by Marcos Eduardo Galperin on October 15, 1999 and is headquartered in Buenos Aires, Argentina.