UBS downgraded MercadoLibre to Neutral from Buy. The firm lowered its price target from $2,700 to $2,050.
Analysts cited concerns regarding the current investment cycle and its impact on profitability. A lower free-shipping threshold creates uncertainty about the timing of future profits.
UBS projects continued margin pressure with no recovery expected until 2027 or 2028. Strategic expansions into credit cards and cross-border trade drive the ongoing spending. Persistent e-commerce competition limits the potential for near-term earnings revisions.