MELI Stock Rises Overnight After Post-Earnings Tumble: Michael Burry Buys The Dip Even As Analysts Flag Caution

• BTIG cut its target price on MercadoLibre to $2,150 from $2,400 and expressed disappointment over a decline in profits. 
• Raymond James raised revenue forecasts through 2026 to 2028, but lowered profit estimates due to higher spending.
• Michael Burry sees MercadoLibre's 2026 revenue increasing by about 30% year-on-year. 

MercadoLibre (MELI) stock gained overnight after its biggest intraday fall in two months as investors reacted to weaker-than-expected first-quarter (Q1) earnings, even as the Latin American e-commerce and fintech giant posted a jump in sales.

The company’s Q1 revenue, announced on Thursday, increased 49% year-on-year to $8.85 billion with earnings per share (EPS) of $8.23. While revenue beat the Street estimate of $8.3 billion, EPS came in below the estimate of $8.47, according to Fiscal AI data. 

Analysts Slash MELI’s Price Target 

On Friday, BTIG cut its target price on MercadoLibre to $2,150 from $2,400 while maintaining a ‘Buy’ rating on the stock, as per TheFly. The firm said investors were caught off guard by a steep decline in operating margins during Q1.

The company reported a 19% YoY decrease in operating income to $611 million. 

According to the analyst, the company’s profitability fell well short of earlier expectations, landing near 7% for the quarter. Even so, BTIG believes MercadoLibre’s elevated spending could strengthen its competitive position over the long term by helping it build a larger and more dominant platform across Latin America.

Raymond James lowered its MELI stock target to $2,000 from $2,250 but kept a ‘Strong Buy’ rating. The firm expects higher sales but lower profits over the next few years, through 2028, because it is investing more in growth and expansion. 

MercadoLibre stock edged 0.5% higher overnight, heading into Monday. 

Michael Burry Buys The MELI Slump 

Michael Burry, the investor known for predicting the 2008 housing crash, disclosed a new position in MercadoLibre after the stock dropped following its earnings report. 

“And this morning I purchased a new full position in Mercado Libre MELI in the $1600s. The stock is down on earnings last night,” said Burry, in a Substack post on Friday. 

The investor stated that MercadoLibre now trades below what he called his “IV15” valuation level.

“MELI is now well below my IV15 price, at which I expect long-term 15% annualized returns at 15 years or more,” Burry said. He expects the company to generate nearly $40 billion in revenue this year, up roughly 30% from 2025 levels.

MercadoLibre operates one of the largest online shopping and digital payments ecosystems across Latin America, with major operations in Brazil, Mexico and Argentina. 

MELI Retail Traders View

On Stocktwits, retail sentiment around the stock remained in ‘extremely bullish’ territory. 

A user said MELI’s margins will “suffer in short term as they grow/expand their credit portfolio (up 87% YoY) because they have to account for expected credit losses upfront but the short term headwind to eps will be a tailwind down the road as they recognize the interest income.”

Another said, “Even with macro headwinds, MELI continues to outperform the broader market, proving resilience in its core LATAM ecosystem (commerce + fintech stack).” 

MELI stock has slumped nearly 19% year-to-date. 

Also See: RXT Stock’s Wild 200% Rally Last Week Has Retail Bulls Comparing It To IREN, Sandisk Momentum Plays

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