Jun. 11 at 10:19 PM
$MELI ads business is estimated to have hit a
$2B run-rate with 73% YoY growth.
Management previously said ads are a high margin business, with EBIT around 80%.
After tax, that would contribute about
$1.2B toward net income. At a 40x P/E, which is conservative IMO for a high margin business growing 73% YoY, Mercado Ads alone would be worth around
$50B.
MELI’s market cap is
$82B, which suggests the market may be giving surprisingly little credit to ads relative to the rest of the commerce, logistics, payments, credit, and fintech businesses.
