MercadoLibre Gross Merchandise Volume Soars 73 Pct In April

Buenos Aires-based eCommerce market MercadoLibre has seen a boost thanks to the pandemic, with shares climbing above $1,000 and sales spiking, Bloomberg reported.

The company is up 78 percent this year, with a lot of the boost coming from new customers who had not used the internet to buy things so much before the pandemic made it a necessity. Some of them had never used eCommerce at all, Bloomberg reported.

According to analysts with Bank of America, even as the market begins to recover and people go out more often, the tendency to buy more online might stick, Bloomberg reported.

The site is primarily focused on consumer-packaged goods and counts Brazil as its largest market.

The company’s value has leapt to $50 billion, higher than eBay’s $39 billion valuation.

MercadoLibre said gross merchandise volume had grown to 73 percent in April, and UBS Group AG said the numbers were even stronger in May, citing data from Ebit, Nielsen’s eCommerce researcher. UBS Group’s analysts were led by Gustavo Piras Oliveira, Bloomberg reported. The group reconfirmed MercadoLibre as its top pick in the sector, raising the stock’s price target to $1,040.

“Recent sector data makes us more confident that Brazilian eCommerce growth could deliver on high expectations,” the June 3 report said, according to Bloomberg.

Bank of America’s analysis, led by Robert Ford, raised the target price to $1,100 in a June 9 report.

The company also boasts a payments and wallets platform, Mercado Pago, which has also been attracting attention as more people want to use digital means for payments. Morgan Stanley expected the payment volume to grow 70 percent in 2020 and 69 percent in 2021 as more people use the platform, Bloomberg reported.

In a recent PYMNTS report, MercadoLibre Executive Vice President and CEO of FinTech Osvaldo Giménez said a challenge of the company is trying to keep up with regulations and rules in the 18 countries where MercadoLibre operates. For instance, he said, the use of debit cards online can vary — in Brazil, where many issuers don’t let users perform online transactions, it can be a hindrance, and cash payments are available.

Mercado Pago, then, could be a help in those cases, allowing easier digital transference of funds, Giménez said.


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.