Our long-term view on MercadoLibre is that it will dominate broad e-commerce in South America over the next decade because the industry tends to be dominated by one big player enjoying all the economics of scale, and we also believe that there is a local element favouring MercadoLibre above Amazon as we have seen Amazon having problems in their internationalization. The key risks are obviously the volatile political situation in South America and the current high equity valuation which could mean lower expected returns despite high growth over the coming years.
Other earnings releases to watch next week
The list below shows the 30 most important earnings releases this week. Besides MercadoLibre which we have covered above, Toyota Motor being the world’s biggest carmaker will give valuable insights into consumer demand but also semiconductor shortage. Adyen reporting on Wednesday is important for sentiment of payment companies in general but in particularly technology stocks in Europe. Uber Technologies is part of the ‘bubble stocks’ segment with very aggressive valuation so an earnings miss could impact this segment. Disney reporting Thursday is relevant for Netflix and the overall demand for video streaming. AstraZeneca with all its troubles around its Covid-19 vaccine will obviously in focus on Thursday and the pressure has not been reduced following news yesterday that South Africa is halting vaccinations using the company’s vaccine as it is shown to not be effective against the South African mutation. Schneider Electric also reports on Thursday and is an important industrial conglomerate in Europe that sits in the middle of the global manufacturing rebound and potentially rising input costs.
Monday: SoftBank Group, Global Payments
Tuesday: Total, Daikin Industries, S&P Global, Cisco, Fiserv, Fidelity National Information
Wednesday: Toyota Motor, Commonwealth Bank of America, MercadoLibre, Adyen, Heineken, Air Liquide, CME Group, General Motors, Uber Technologies, Coca-Cola, Equinor
Thursday: Zurich Insurance, PepsiCo, Duke Energy, Brookfield Asset Management, Disney, L’Oreal, Illumina, AstraZeneca, Schneider Electric
Friday: Enbridge, Dominion Energy