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Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: A quality valuation analysis on $MELI 🧘🏽♂️
•NTM P/E Ratio: 39.87x
•P/E Ratio Mean: 46.42x
As you can see, $MELI appears to be trading below fair value
Going forward, investors can receive ~16% MORE in earnings per share 🧠***
Before we get into valuation, let’s take a look at why $MELI is a great business
BALANCE SHEET✅
•Cash & Short-Term Inv: $3.98B
•Long-Term Debt: $3.43B
$MELI has a strong balance sheet, a BB+ S&P Credit Rating & 52x FFO Interest Coverage
RETURN ON CAPITAL🆗➡️✅
•2020: 3.7%
•2021: 8.1%
•2022: 14.7%
•2023: 25.7%
•2024: 23.0%
•LTM: 19.7%
RETURN ON EQUITY🆗➡️✅
•2020: (0.1%)
•2021: 5.2%
•2022: 28.7%
•2023: 40.3%
•2024: 51.5%
•LTM: 43.8%
$MELI has strong and improved return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2019: $2.30B
•2024: $20.78B
•CAGR: 55.30%
FREE CASH FLOW✅
•2019: $314.29M
•2024: $7.05B
•CAGR: 86.32%
NORMALIZED EPS✅
•2019: ($3.71)
•2024: $37.69
SHARE BUYBACKS❌
•2019 Shares Outstanding: 48.69M
•LTM Shares Outstanding: 50.70M
MARGINS🆗➡️✅
•LTM Gross Margins: 51.5%
•LTM Operating Margins: 12.3%
•LTM Net Income Margins: 8.5%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~16% MORE in EPS
Using Benjamin Graham’s 2G rule of thumb, $MELI has to grow earnings at an 19.94% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be more than the (19.94%) required growth rate:
2025E: $44.33 (17.6% YoY)
2026E: $66.58 (50.2% YoY)
2027E: $89.03 (33.7% YoY)
$MELI has an ok track record of meeting analyst estimates ~2 years out, but let’s assume $MELI ends 2027 with $80.12 in EPS & see its CAGR potential assuming different multiples
40x P/E: $3204💵 … ~20.2% CAGR
38x P/E: $3044💵 … ~17.5% CAGR
36x P/E: $2884💵 … ~14.6% CAGR
34x P/E: $2724💵 … ~11.7% CAGR
As you can see, $MELI appears to have attractive return potential IF we assume >34x earnings (a multiple justified by its growth rate & moat) & 2027 EPS -10% below estimates
$MELI boasts an expansive growth trajectory, fueled by powerful network effects that should drive sustained momentum
Key factors contributing to its promising outlook include 🔑
1. Margin expansion
2. Unparalleled access to Latin America's burgeoning economy
3. Network effects & scale economies shared that produce self-reinforcing dynamics ensuring long-term competitiveness, among other things
These growth rates have to be revised down substantially for $MELI to miss the mark, even if the company grows earnings at 25% CAGR over the next 5 years, shareholders will likely end up with a great return
Today I consider $MELI a compelling consideration for investment at $2130💵
#stocks #investing
___
DISCLOSURE‼️: This is NOT Investment Advice. Babylon Capital® and its representatives may have positions in the securities discussed in this post.
The information contained in this post is intended for informational purposes only and should not be construed as investment advice to meet the specific needs of any individual or situation. Past performance is no guarantee of future results.
Information contained in this post has been obtained from sources believed to be reliable, but is not guaranteed as to completeness or accuracy.
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RT @DimitryNakhla: A quality valuation analysis on $MELI 🧘🏽♂️
•NTM P/E Ratio: 39.87x
•P/E Ratio Mean: 46.42x
As you can see, $MELI appears to be trading below fair value
Going forward, investors can receive ~16% MORE in earnings per share 🧠***
Before we get into valuation, let’s take a look at why $MELI is a great business
BALANCE SHEET✅
•Cash & Short-Term Inv: $3.98B
•Long-Term Debt: $3.43B
$MELI has a strong balance sheet, a BB+ S&P Credit Rating & 52x FFO Interest Coverage
RETURN ON CAPITAL🆗➡️✅
•2020: 3.7%
•2021: 8.1%
•2022: 14.7%
•2023: 25.7%
•2024: 23.0%
•LTM: 19.7%
RETURN ON EQUITY🆗➡️✅
•2020: (0.1%)
•2021: 5.2%
•2022: 28.7%
•2023: 40.3%
•2024: 51.5%
•LTM: 43.8%
$MELI has strong and improved return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2019: $2.30B
•2024: $20.78B
•CAGR: 55.30%
FREE CASH FLOW✅
•2019: $314.29M
•2024: $7.05B
•CAGR: 86.32%
NORMALIZED EPS✅
•2019: ($3.71)
•2024: $37.69
SHARE BUYBACKS❌
•2019 Shares Outstanding: 48.69M
•LTM Shares Outstanding: 50.70M
MARGINS🆗➡️✅
•LTM Gross Margins: 51.5%
•LTM Operating Margins: 12.3%
•LTM Net Income Margins: 8.5%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~16% MORE in EPS
Using Benjamin Graham’s 2G rule of thumb, $MELI has to grow earnings at an 19.94% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be more than the (19.94%) required growth rate:
2025E: $44.33 (17.6% YoY)
2026E: $66.58 (50.2% YoY)
2027E: $89.03 (33.7% YoY)
$MELI has an ok track record of meeting analyst estimates ~2 years out, but let’s assume $MELI ends 2027 with $80.12 in EPS & see its CAGR potential assuming different multiples
40x P/E: $3204💵 … ~20.2% CAGR
38x P/E: $3044💵 … ~17.5% CAGR
36x P/E: $2884💵 … ~14.6% CAGR
34x P/E: $2724💵 … ~11.7% CAGR
As you can see, $MELI appears to have attractive return potential IF we assume >34x earnings (a multiple justified by its growth rate & moat) & 2027 EPS -10% below estimates
$MELI boasts an expansive growth trajectory, fueled by powerful network effects that should drive sustained momentum
Key factors contributing to its promising outlook include 🔑
1. Margin expansion
2. Unparalleled access to Latin America's burgeoning economy
3. Network effects & scale economies shared that produce self-reinforcing dynamics ensuring long-term competitiveness, among other things
These growth rates have to be revised down substantially for $MELI to miss the mark, even if the company grows earnings at 25% CAGR over the next 5 years, shareholders will likely end up with a great return
Today I consider $MELI a compelling consideration for investment at $2130💵
#stocks #investing
___
DISCLOSURE‼️: This is NOT Investment Advice. Babylon Capital® and its representatives may have positions in the securities discussed in this post.
The information contained in this post is intended for informational purposes only and should not be construed as investment advice to meet the specific needs of any individual or situation. Past performance is no guarantee of future results.
Information contained in this post has been obtained from sources believed to be reliable, but is not guaranteed as to completeness or accuracy.
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Capital Employed
RT @capitalemployed: Anyone know when @IBKR are going to start trading South Korean stocks? 🇰🇷
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RT @capitalemployed: Anyone know when @IBKR are going to start trading South Korean stocks? 🇰🇷
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Offshore
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App Economy Insights
$AMD is now the largest holding in App Economy Portfolio. 👀
Our position started in 2017 is up 1,175% (a 12-bagger).
• Stock Idea of July (+71% since then).
• 1 of our 12 Starter Stocks (updated last week). https://t.co/jdPVZ7MUFd
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$AMD is now the largest holding in App Economy Portfolio. 👀
Our position started in 2017 is up 1,175% (a 12-bagger).
• Stock Idea of July (+71% since then).
• 1 of our 12 Starter Stocks (updated last week). https://t.co/jdPVZ7MUFd
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Offshore
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Quiver Quantitative
[UPDATE]
We recently posted a report on Marjorie Taylor Greene's purchase of Impinj stock, $PI.
It caught our eye, because it was a small company that no one in Congress had traded for years.
The stock has now risen 177% since her April 4th purchase. https://t.co/tGJEnK7fIj
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[UPDATE]
We recently posted a report on Marjorie Taylor Greene's purchase of Impinj stock, $PI.
It caught our eye, because it was a small company that no one in Congress had traded for years.
The stock has now risen 177% since her April 4th purchase. https://t.co/tGJEnK7fIj
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Offshore
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Yellowbrick Investing
Added 65 new stock write-ups to the site (pt final):
@DavidDiranko (Monday Monitor) - $UNTC, $ENQ.L, $MORLD.OL, $GQG.AX, $TWR.AX
@Fintegrate - $APP, $ISRG
@SCapStrategist - $ANDR.VI (overview)
@nicknemo17 - $TDOC
@BrowarekMateusz - $MSP.WA (overview)
fund letters
and more... https://t.co/ASmOCph0BG
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Added 65 new stock write-ups to the site (pt final):
@DavidDiranko (Monday Monitor) - $UNTC, $ENQ.L, $MORLD.OL, $GQG.AX, $TWR.AX
@Fintegrate - $APP, $ISRG
@SCapStrategist - $ANDR.VI (overview)
@nicknemo17 - $TDOC
@BrowarekMateusz - $MSP.WA (overview)
fund letters
and more... https://t.co/ASmOCph0BG
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Offshore
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Dimitry Nakhla | Babylon Capital®
Fair Isaac is well-positioned to capitalize on a potential mortgage rate refinancing surge 💵
$FICO https://t.co/yuH39UzAMC
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Fair Isaac is well-positioned to capitalize on a potential mortgage rate refinancing surge 💵
$FICO https://t.co/yuH39UzAMC
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Offshore
Video
The Startup Ideas Podcast (SIP) 🧃
RT @gregisenberg: Mastering OpenAI's NEW AI AGENT builder in 26 mins:
– start with one simple flow (lead capture or faq bot) before adding logic complexity.
– use vector stores sparingly - too much context slows performance.
– name your nodes clearly so you can debug fast.
– integrate with chatkit early if you plan to embed it on a site.
– test edge cases (misclassifications, loops, context drops).
– think in outcomes, not features - what task can an agent take off your plate today?
– treat this as a sandbox, not production - learn what’s possible before scaling.
ideas on what you can build (to get your creative juices flowing):
– lead qualification → build a multi-agent flow that classifies visitors as hot, warm, or cold, then sends data straight into hubspot or notion crm.
– product onboarding → use logic nodes to detect user type (beginner vs. pro) and serve different walkthroughs automatically.
– customer support → route basic questions to a support agent, complex ones to human reps, and have it all sync to slack or intercom.
it’s still early.
the ui has limits, the logic feels clunky, and customization can’t yet match purpose-built platforms like lindy, which give you deeper control and long-term memory.
but it's worth taking it for a spin. will be interesting to see how it evolves.
and @amirmxt does a remarkable job clearly explaining how to build with agentkit etc on @startupideaspod (you can follow for more)
full ep on yt will be in the replies.
What do you think of OpenAI new agent builder?
tweet
RT @gregisenberg: Mastering OpenAI's NEW AI AGENT builder in 26 mins:
– start with one simple flow (lead capture or faq bot) before adding logic complexity.
– use vector stores sparingly - too much context slows performance.
– name your nodes clearly so you can debug fast.
– integrate with chatkit early if you plan to embed it on a site.
– test edge cases (misclassifications, loops, context drops).
– think in outcomes, not features - what task can an agent take off your plate today?
– treat this as a sandbox, not production - learn what’s possible before scaling.
ideas on what you can build (to get your creative juices flowing):
– lead qualification → build a multi-agent flow that classifies visitors as hot, warm, or cold, then sends data straight into hubspot or notion crm.
– product onboarding → use logic nodes to detect user type (beginner vs. pro) and serve different walkthroughs automatically.
– customer support → route basic questions to a support agent, complex ones to human reps, and have it all sync to slack or intercom.
it’s still early.
the ui has limits, the logic feels clunky, and customization can’t yet match purpose-built platforms like lindy, which give you deeper control and long-term memory.
but it's worth taking it for a spin. will be interesting to see how it evolves.
and @amirmxt does a remarkable job clearly explaining how to build with agentkit etc on @startupideaspod (you can follow for more)
full ep on yt will be in the replies.
What do you think of OpenAI new agent builder?
tweet
Offshore
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Umesh
Feels like it was Level 1 just yesterday, remember chatting with GPT-3.5?
It wasn’t that long ago. Today, we see math problems being solved with the assistance of AI.
The world is not the same anymore.
The percentage of people who disagree with the progress of AI is declining by the day.
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Feels like it was Level 1 just yesterday, remember chatting with GPT-3.5?
It wasn’t that long ago. Today, we see math problems being solved with the assistance of AI.
The world is not the same anymore.
The percentage of people who disagree with the progress of AI is declining by the day.
In a little over a year, we’ve gone from Level 1 to nearly Level 4. Level 5 is the boss fight, so it won’t be easy, but we’ll get there within two years, at most.
The question is, what’s next? What will Levels 6 through 10 look like? We should start thinking about that now! https://t.co/KYhjn2yJju tweet