MercadoLibre and Netflix are underperforming the broader market, trading 11% and 21% lower in 2026 respectively, even as the S&P 500 has posted a double-digit percentage gain. Netflix stock has fallen 38% over the past year, including a 9% drop after its second-quarter update in mid-July, as revenue growth decelerated from 18% in the fourth quarter of last year to 13% in the most recent quarter, and its current-quarter guidance calls for just an 11.7% increase. MercadoLibre shares tumbled on Thursday after its second-quarter results, despite a 50% surge in revenue, as contracting margins, rising credit loss provisions, and promotional spending in Brazil fueled concerns about overspending. The author, who owns both stocks, considers MercadoLibre the more attractive buy in August due to its faster growth and longer runway in Latin America's earlier-stage digital migration, even though it trades at a higher forward earnings multiple of 31 times compared to Netflix's 19 times.
MercadoLibre Inc.Q2 results showed contracting margins, rising credit loss provisions, and promotional spending in Brazil, fueling overspending concerns.
Netflix IncQ2 update showed revenue growth deceleration and weak guidance, causing a 9% drop.
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