Key Highlights
- Bank of America maintained its Buy recommendation on MELI with a $2,400 price objective
- The company’s credit card portfolio jumped more than 100% year-over-year in Q1 2026, hitting $6.6 billion and representing 45% of its total lending portfolio
- Analysts at BofA anticipate the credit card division will record a $443M EBIT deficit in 2026, turning profitable by 2028 and generating $1.5B in earnings by 2030
- Shares have declined 34.5% year-to-date against the S&P 500’s 24% rally, yet 85% of Wall Street analysts maintain Buy recommendations
- The most optimistic forecast comes from Scotiabank’s Hector Maya at $2,800 — representing a 72% increase from today’s valuation
Shares of MercadoLibre are changing hands near $1,622 as of June 9, 2026, reflecting an approximately 34.5% decline since the beginning of the year even as the broader S&P 500 index has advanced 24%.
Despite this significant performance divergence, the analyst community remains decidedly optimistic. Eighty-five percent of those covering the e-commerce and fintech giant maintain Buy recommendations, with every single price target exceeding the current trading level.
Bank of America Securities reaffirmed its Buy stance this week, maintaining its $2,400 valuation objective. Covering analyst Robert E. Ford Aguilar highlighted the company’s expanding credit card operations as a crucial catalyst for sustained value creation, despite temporary pressure on profitability metrics.
MercadoLibre’s credit card lending portfolio experienced explosive growth in Q1 2026, more than doubling on a year-over-year basis to reach $6.6 billion. This segment now accounts for roughly 45% of the entire loan portfolio.
Monthly active users utilizing credit cards surged 68% during the identical timeframe, significantly outpacing the 29% expansion in overall Mercado Pago monthly active users. This represents exceptionally strong momentum in a strategic growth vertical.
However, BofA forecasts the credit card operation will generate an EBIT deficit of $443 million throughout 2026. This represents a margin headwind of 1.1 percentage points on a consolidated basis. Industry dynamics typically require 12 to 18 months for credit card ventures to achieve net interest margin profitability due to initial provisioning requirements.
Analysts project this segment will achieve profitability by 2028, subsequently delivering $1.5 billion in EBIT by decade’s end. This trajectory would contribute 2.2 percentage points to consolidated margins compared to 2026 baseline levels.
Modest Market Share Presents Substantial Growth Runway
Notwithstanding the impressive credit card momentum, MercadoLibre commanded merely 3.4% of total credit card outstanding balances in Brazil and 2.5% in Mexico as of March 2026. The opportunity for market share expansion remains considerable.
The platform also introduced its credit card offering in Argentina, where it serves 19.9 million daily active Pago application users — surpassing the 12.9 million user base in Brazil. BofA’s Aguilar emphasized that reduced customer acquisition expenses and superior brand recognition in this market should facilitate accelerated portfolio growth as Argentina’s inflationary environment continues stabilizing.
Argentina’s chronically suppressed credit penetration rates, stemming from prolonged economic volatility, indicate the market remains largely underdeveloped.
Impressive Expansion Metrics Across the Platform
Taking a broader perspective, MELI’s consolidated operations have delivered 31% compound annual growth over the trailing decade. Total credit users expanded from 10 million in 2022 to 41.9 million by Q1 2026. The aggregate credit portfolio ballooned from $2.8 billion to $14.6 billion during this identical period.
E-commerce adoption throughout Latin America stands at merely 14%, compared with 27% in the United States and 32% in China. The total addressable market opportunity is valued at $5.5 trillion, against trailing twelve-month revenue of $31.8 billion.
Buyers engaging with at least three distinct product categories increased 130% from 2022 through Q1 2026. Average quarterly transaction frequency climbed from 6.8 to 9 during the same timeframe.
The highest price objective on the Street belongs to Scotiabank’s Hector Maya at $2,800 — implying 72% appreciation from present levels, though this actually represents a reduction from his previous $3,500 target.
BofA employs a sum-of-the-parts valuation methodology: assigning the commerce segment 0.6x projected 2027 gross merchandise value and the fintech division 0.2x anticipated 2027 off-platform total payments value, yielding the $2,400 price objective.
