MercadoLibre MELI and Amazon AMZN are among the most dominant e-commerce and digital payments platforms across the Americas. MercadoLibre has built a leading e-commerce and embedded fintech ecosystem across Latin America, while Amazon operates the world’s largest online retail platform, supported by deeply integrated payments, advertising infrastructure and its cloud computing arm, Amazon Web Services. Both companies are embedding financial services within their marketplaces and monetizing consumer intent through advertising.
The comparison is relevant as both businesses navigate a key inflection point in e-commerce. Artificial intelligence is being deployed across product discovery, payments and advertising to improve conversion and personalization, while continued investments in logistics are driving purchase frequency and strengthening user retention. With Amazon executing at a global scale and MercadoLibre expanding in an underpenetrated market, let us assess which stock offers greater upside.
The Case for MELI
MercadoLibre has built an integrated commerce and logistics network in Latin America, investing heavily in fulfillment infrastructure, last-mile delivery and seller tooling across its core markets for over two decades. The reduction of Brazil's free shipping threshold has proven an effective demand lever, driving gross merchandise volume (GMV) and items sold growth of 35% and 45%, respectively, in the fourth quarter of 2025, alongside strong conversion and retention trends. However, the platform is accepting near-term margin compression in exchange for accelerating purchase frequency and deepening its logistics moat.
Artificial intelligence is being embedded across product discovery, seller tooling and advertising, functioning as a revenue accelerator across the platform. AI-powered seller assistance tools are guiding merchants on listing quality and pricing, influencing 20% of GMV, while AI-driven bidding and campaign automation are improving advertiser returns and driving larger budgets through the platform. Advertising revenues grew 67% on a FX-neutral basis, and with penetration still low relative to GMV, this remains a structurally high-margin growth layer with considerable room to scale.
Mercado Pago's credit portfolio doubled year over year to $12.5 billion, with 3 million credit cards issued in the previous quarter. While older Brazilian cohorts are generating positive returns at the net interest margin after losses level, the book, however, remains NIMAL negative, as newer and riskier cohorts dilute aggregate returns. The credit card non-performing loan ratio has improved to an all-time low of 4.4%, but early-stage delinquencies edged higher despite favorable seasonality, indicating deliberate movement down the credit quality curve. This credit expansion is unfolding across markets that carry inherent macroeconomic risk, where currency. Currency volatility and political cycles can shift abruptly, accelerating provisioning requirements and compressing fintech margins rapidly.
The Zacks Consensus Estimate for first-quarter 2026 EPS is pegged at $9.73, indicating a year-over-year decline of 0.10%.
MercadoLibre, Inc. Price and Consensus
MercadoLibre, Inc. price-consensus-chart | MercadoLibre, Inc. Quote
The Case for AMZN
Amazon's competitive durability stems from geographic diversification, business line breadth and a proprietary dataset accumulated across decades of global commerce. Unlike MELI, its exposure to mature and relatively stable economies results in steadier cash flows and lower earnings volatility. This scale generates large volumes of consumer data, which improves search relevance, personalization and advertising targeting. Expansion into everyday essentials and perishable groceries further strengthens this advantage. These categories grew nearly twice as fast as others and accounted for one in every three units sold in the United States in 2025. This shift reinforces the flywheel between product selection, delivery reliability and purchase frequency.
The logistics network remains a foundational advantage. Improvement in delivery speed and cost to serve reflects a fulfillment infrastructure where efficiency gains are structural rather than cyclical. North America segment operating margins expanded to 9% in the fourth quarter of 2025, driven by robotics, inventory placement optimization and package consolidation. Amazon Now, the 30-minute delivery service already live in India, Mexico and the UAE, is expected to accelerate purchase frequency as it scales.
Artificial intelligence is amplifying advantages across commerce and advertising. Rufus, the agentic shopping assistant, used by over 300 million customers in 2025 and driving higher purchase conversion, illustrates how Amazon's data advantage translates directly into engagement depth. Advertising revenues grew 22% in the fourth quarter, with AI-powered campaign tools broadening advertiser participation and sustaining growth in Amazon's highest margin business segment.
However, near-term risk centers on capital intensity with $200 billion in capital expenditure planned for 2026, sustaining pressure on free cash flow even as profitability improves. The Zacks Consensus Estimate for first quarter 2026 EPS is pegged at $1.69, indicating year-over-year growth of 6.29%.
Amazon.com, Inc. Price and Consensus
Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote
Price Performance and Valuation of MELI and AMZN
In the year-to-date period (YTD), AMZN shares are up 8.2%, while MELI shares have plunged 9.5%. The rally in Amazon's shares is supported by consistently expanding operating margins, accelerating advertising growth and the compounding returns from its logistics efficiency investments. However, MELI's performance is influenced by near-term margin compression from logistics and credit card investment and macroeconomic headwinds across Latin America.
MELI vs. AMZN YTD PERFORMANCE
Image Source: Zacks Investment Research
On a forward price-to-sales basis, AMZN trades at 3.22x while MELI trades at 2.23x. Amazon's premium is justified given its global exposure and diversified revenue base across commerce, advertising and cloud, which collectively support a more durable and predictable earnings profile than MELI's regionally concentrated model exposed to volatile and uncertain Latin American markets.
MELI vs. AMZN- Price/Sales (F12M)
Image Source: Zacks Investment Research
Conclusion
MercadoLibre and Amazon are executing similar playbooks, embedding financial services within their marketplaces and using artificial intelligence to deepen monetization across commerce and advertising. However, their risk profiles diverge. MercadoLibre offers stronger long-term growth in an underpenetrated market, but near-term pressures from credit expansion, margin compression and regional macro volatility weigh on earnings visibility. In contrast, Amazon benefits from expanding margins, a more diversified revenue base and scale-driven logistics advantages, supporting a more stable earnings trajectory. With both stocks carrying a Zacks Rank #3 (Hold), Amazon appears to offer relatively greater upside.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
