Looking for obvious growth stocks? look here

Unless you’re retired and need to invest very conservatively, most investors want to have at least a few top growth stocks in their portfolio. There are no guarantees in the market, which is why diversification is so important. However, there are a few rare stocks that seem obvious. They are showing incredible growth, are already profitable and have strong growth drivers.

MercadoLibre(NASDAQ: MELI) fits this framework, and there are several reasons why the investment thesis seems so compelling right now.

The trends are in his favor

Global e-commerce continues to grow as a percentage of global retail sales, but it’s not the same everywhere. Consider the countries with the fastest e-commerce growth.

Image source: Statista.

Three of the five countries with the fastest-growing e-commerce sales rates are in Latin America. What’s more, these are MercadoLibre’s top three regions – Mexico, Argentina and Brazil – and all of them are well ahead of the global pack.

Argentina, which has historically been MercadoLibre’s main growth market, recorded negative year-on-year revenue growth in the first quarter of 2024 due to high inflation. However, gross merchandise volume (GMV) increased year-over-year in Mexico and by 36% in Brazil, exceeding 2023 rates for these countries.

MercadoLibre continues to demonstrate exceptional growth in both e-commerce and the newer fintech business. Total GMV increased 20% year-over-year in the first quarter, representing a 71% currency neutrality with 25% sales growth.

It operates in countries that are just getting started with e-commerce and digital services in general. Therefore, the fintech segment, which was initially intended to serve customers who did not have credit cards as a way to pay for purchases, is growing at a breakneck pace. Total payment volume grew 35%, or 86%, on a currency neutral basis in the first quarter.

What worries investors most is that there is more to come as these countries continue to adopt e-commerce and digital payments. MercadoLibre is well positioned to maintain strong growth and create shareholder value.

Is it worth investing $1,000 in MercadoLibre now?

Before you buy stock in MercadoLibre, consider this:

The Motley Fool Stock Advisor a team of analysts have just identified what they think it is 10 best stocks for investors to buy now… and MercadoLibre wasn’t one of them. 10 stocks that made a cut could deliver monster returns in the coming years.

Consider when Nvidia created this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you would have $581,764!*