TLDR
- Michael Burry confirmed he bought a full position in MercadoLibre (MELI) in the $1,600s last week after the stock dropped on earnings.
- MELI fell 12.7% on Friday following its earnings report, then recovered 0.5% in premarket trading Monday.
- Burry projects MELI’s 2026 sales will near $40 billion, roughly 30% higher than 2025.
- He highlighted that MELI uses cash-settled awards instead of stock-based compensation.
- Burry said the stock is “well below” his IV15 price, where he expects 15% annualized returns over 15+ years.
Michael Burry disclosed on his Substack on May 11 that he purchased a new full position in MercadoLibre (MELI) last week, buying in the $1,600s after the stock tumbled 12.7% on Friday following its earnings release.
MELI edged up 0.5% in premarket trading on Monday. The stock is now sitting near its 52-week low of $1,593.21 and is down roughly 33% over the past year.
Burry’s entry point came right around that 52-week low — which is exactly the kind of moment he tends to move.
In his post, Burry pointed to MELI’s projected revenue of nearly $40 billion for 2026, which would represent a 30% increase over 2025. That growth rate, for a company already at this scale, is what caught his attention.
He also flagged something less commonly discussed: MercadoLibre does not use stock-based compensation. Instead, its employee award system is cash-settled — a structure Burry views favorably when evaluating long-term value.
“MELI is now well below my IV15 price, at which I expect long-term 15% annualized returns at 15 years or more,” Burry wrote.
Why Burry Likes the Infrastructure Story
Burry also noted that MELI runs on a massive cloud-based infrastructure backed by Amazon Web Services. He was clear that the company does not market third-party cloud services — it simply uses the infrastructure to support its own operations.
That distinction matters to Burry. He’s not calling MELI a cloud play. He’s calling it a well-run operator with the backbone to support continued growth across Latin America.
MercadoLibre operates across Brazil, Argentina, and Mexico, which together account for more than 95% of its revenue. It reported over 120 million unique active buyers and 1 million active sellers as of the end of 2025.
The company carries a market cap of approximately $83.17 billion and trades at a P/E ratio of around 41.64x.
What the Data Shows
According to GuruFocus, MELI holds a GF Score of 82 out of 100. It scores a 10/10 on growth and 8/10 on profitability. Financial strength comes in at 6/10.
The GF Value estimate puts MELI at $3,420.67 — a level GuruFocus labels as “significantly undervalued” relative to current prices.
One insider buying transaction was also recorded in the past three months, covering 57 units.
Burry’s position is new. As of last week, he did not previously hold MELI in his disclosed portfolio.
The stock closed Friday at a price consistent with that 52-week low range, and Burry’s Substack post confirmed the purchase was made during that same week of weakness.
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