Comprehensive Stock Comparison
Compare MercadoLibre, Inc. (MELI) vs PDD Holdings Inc. (PDD) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | PDD | 59.0% revenue growth vs MELI's 39.1% |
| Value | PDD | Lower P/E (1.2x vs 30.8x) |
| Quality / Margins | PDD | 24.4% net margin vs MELI's 6.9% |
| Stability / Safety | PDD | Beta 0.82 vs MELI's 0.88, lower leverage |
| Dividends | Tie | Neither pays a meaningful dividend |
| Momentum (1Y) | PDD | -8.8% vs MELI's -17.2% |
| Efficiency (ROA) | PDD | 16.7% ROA vs MELI's 4.7%, ROIC 40.3% vs 20.8% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Defensive / Recession hedge
Business Model
What each company does and how it makes money
MercadoLibre is the dominant e-commerce and fintech platform across Latin America, operating online marketplaces and financial services. It generates revenue primarily from marketplace commissions and advertising fees (roughly 60%) and fintech services including payments, credit, and digital wallets (roughly 40%). The company's moat comes from its integrated ecosystem—combining e-commerce, payments, logistics, and credit—which creates powerful network effects and high switching costs across Latin America's fragmented markets.
PDD Holdings operates Pinduoduo and Temu, two major e-commerce platforms that connect consumers directly with manufacturers and merchants. It generates revenue primarily through online marketing services—where merchants pay for advertising and promotions—and transaction fees from sales on its platforms. The company's key advantage lies in its deep integration of social commerce features and aggressive pricing strategies that drive high user engagement and network effects.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
PDD leads in 4 of 6 categories (Financial Metrics, Profitability & Efficiency). MELI leads in 1 (Total Returns). 1 tied.
Financial Metrics (TTM)
PDD is the larger business by revenue, generating $418.5B annually — 14.5x MELI's $28.9B. PDD is the more profitable business, keeping 24.4% of every revenue dollar as net income compared to MELI's 6.9%. On growth, MELI holds the edge at +44.6% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| RevenueTrailing 12 months | $28.9B | $418.5B |
| EBITDAEarnings before interest/tax | $4.0B | $93.0B |
| Net IncomeAfter-tax profit | $2.0B | $102.3B |
| Free Cash FlowCash after capex | $10.1B | $111.4B |
| Gross MarginGross profit ÷ Revenue | +44.5% | +56.6% |
| Operating MarginEBIT ÷ Revenue | +11.1% | +22.1% |
| Net MarginNet income ÷ Revenue | +6.9% | +24.4% |
| FCF MarginFCF ÷ Revenue | +35.0% | +26.6% |
| Rev. Growth (YoY)Latest quarter vs prior year | +44.6% | +9.0% |
| EPS Growth (YoY)Latest quarter vs prior year | -12.5% | +16.5% |
Valuation Metrics
At 9.4x trailing earnings, PDD trades at a 79% valuation discount to MELI's 44.6x P/E. On an enterprise value basis, MELI's 24.1x EV/EBITDA is more attractive than PDD's 35.9x.
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| Market CapShares × price | $89.1B | $577.6B |
| Enterprise ValueMkt cap + debt − cash | $96.8B | $570.8B |
| Trailing P/EPrice ÷ TTM EPS | 44.62x | 9.36x |
| Forward P/EPrice ÷ next-FY EPS est. | 30.76x | 1.18x |
| PEG RatioP/E ÷ EPS growth rate | — | — |
| EV / EBITDAEnterprise value multiple | 24.09x | 35.88x |
| Price / SalesMarket cap ÷ Revenue | 3.08x | 10.06x |
| Price / BookPrice ÷ Book value/share | 13.20x | 3.36x |
| Price / FCFMarket cap ÷ FCF | 8.27x | 32.76x |
Profitability & Efficiency
MELI delivers a 29.6% return on equity — every $100 of shareholder capital generates $30 in annual profit, vs $26 for PDD. PDD carries lower financial leverage with a 0.03x debt-to-equity ratio, signaling a more conservative balance sheet compared to MELI's 1.69x. On the Piotroski fundamental quality scale (0–9), PDD scores 7/9 vs MELI's 5/9, reflecting strong financial health.
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| ROE (TTM)Return on equity | +29.6% | +26.1% |
| ROA (TTM)Return on assets | +4.7% | +16.7% |
| ROICReturn on invested capital | +20.8% | +40.3% |
| ROCEReturn on capital employed | +28.3% | +42.4% |
| Piotroski ScoreFundamental quality 0–9 | 5 | 7 |
| Debt / EquityFinancial leverage | 1.69x | 0.03x |
| Net DebtTotal debt minus cash | $7.7B | -$47.2B |
| Cash & Equiv.Liquid assets | $3.7B | $57.8B |
| Total DebtShort + long-term debt | $11.4B | $10.6B |
| Interest CoverageEBIT ÷ Interest expense | — | — |
Total Returns (with DRIP)
A $10,000 investment in MELI five years ago would be worth $10,259 today (with dividends reinvested), compared to $5,572 for PDD. Over the past 12 months, PDD leads with a -8.8% total return vs MELI's -17.2%. The 3-year compound annual growth rate (CAGR) favors MELI at 12.9% vs PDD's 5.7% — a key indicator of consistent wealth creation.
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| YTD ReturnYear-to-date | -10.9% | -10.4% |
| 1-Year ReturnPast 12 months | -17.2% | -8.8% |
| 3-Year ReturnCumulative with dividends | +44.1% | +18.2% |
| 5-Year ReturnCumulative with dividends | +2.6% | -44.3% |
| 10-Year ReturnCumulative with dividends | +1628.4% | +288.5% |
| CAGR (3Y)Annualised 3-year return | +12.9% | +5.7% |
Risk & Volatility
PDD is the less volatile stock with a 0.82 beta — it tends to amplify market swings less than MELI's 0.88 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. PDD currently trades 74.4% from its 52-week high vs MELI's 66.4% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 0.88x | 0.82x |
| 52-Week HighHighest price in past year | $2645.22 | $139.41 |
| 52-Week LowLowest price in past year | $1665.00 | $87.11 |
| % of 52W HighCurrent price vs 52-week peak | +66.4% | +74.4% |
| RSI (14)Momentum oscillator 0–100 | 28.7 | 49.5 |
| Avg Volume (50D)Average daily shares traded | 418K | 7.1M |
Analyst Outlook
Wall Street rates MELI as "Buy" and PDD as "Buy". Consensus price targets imply 59.9% upside for MELI (target: $2810) vs 40.5% for PDD (target: $146).
| Metric | MELIMercadoLibre, Inc. | PDDPDD Holdings Inc. |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $2810.00 | $145.75 |
| # AnalystsCovering analysts | 33 | 27 |
| Dividend YieldAnnual dividend ÷ price | — | — |
| Dividend StreakConsecutive years of raises | 0 | 1 |
| Dividend / ShareAnnual DPS | — | — |
| Buyback YieldShare repurchases ÷ mkt cap | +0.0% | 0.0% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| MercadoLibre, Inc. (MELI) | 100 | 334.4 | +234.4% |
| PDD Holdings Inc. (PDD) | 100 | 275.79 | +175.8% |
MercadoLibre, Inc. (MELI) returned +3% over 5 years vs PDD Holdings Inc. (PDD)'s -44%. A $10,000 investment in MELI 5 years ago would be worth $10,259 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| MercadoLibre, Inc. (MELI) | $844M | $28.9B | +3321.7% |
| PDD Holdings Inc. (PDD) | $505M | $393.8B | +77908.4% |
MercadoLibre, Inc.'s revenue grew from $844M (2016) to $28.9B (2025) — a 48.1% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| MercadoLibre, Inc. (MELI) | 16.1% | 6.9% | -57.2% |
| PDD Holdings Inc. (PDD) | -57.8% | 28.5% | +149.4% |
MercadoLibre, Inc.'s net margin went from 16% (2016) to 7% (2025).
Chart 4P/E Ratio History — 5 Years
| Stock | 2021 | 2025 | Change |
|---|---|---|---|
| MercadoLibre, Inc. (MELI) | 88.8 | 51.1 | -42.5% |
| PDD Holdings Inc. (PDD) | 10.7 | 1.3 | -87.9% |
MercadoLibre, Inc. has traded in a 45x–89x P/E range over 4 years; current trailing P/E is ~45x. PDD Holdings Inc. has traded in a 1x–11x P/E range over 4 years; current trailing P/E is ~9x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| MercadoLibre, Inc. (MELI) | 3.09 | 39.39 | +1174.8% |
| PDD Holdings Inc. (PDD) | -0.34 | 76 | +22452.9% |
MercadoLibre, Inc.'s EPS grew from $3.09 (2016) to $39.39 (2025) — a 33% CAGR.
Chart 6Free Cash Flow — 5 Years
MercadoLibre, Inc. generated $11B FCF in 2025 (+2930% vs 2021). PDD Holdings Inc. generated $121B FCF in 2024 (+374% vs 2021).
MELI vs PDD: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is MELI or PDD a better buy right now?
PDD Holdings Inc. (PDD) offers the better valuation at 9.4x trailing P/E (1.2x forward), making it the more compelling value choice. Analysts rate MercadoLibre, Inc. (MELI) a "Buy" — based on 33 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — MELI or PDD?
On trailing P/E, PDD Holdings Inc. (PDD) is the cheapest at 9.4x versus MercadoLibre, Inc. at 44.6x. On forward P/E, PDD Holdings Inc. is actually cheaper at 1.2x.
03Which is the better long-term investment — MELI or PDD?
Over the past 5 years, MercadoLibre, Inc. (MELI) delivered a total return of +2.6%, compared to -44.3% for PDD Holdings Inc. (PDD). A $10,000 investment in MELI five years ago would be worth approximately $10K today (assuming dividends reinvested). Over 10 years, the gap is even starker: MELI returned +1628% versus PDD's +288.5%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — MELI or PDD?
By beta (market sensitivity over 5 years), PDD Holdings Inc. (PDD) is the lower-risk stock at 0.82β versus MercadoLibre, Inc.'s 0.88β — meaning MELI is approximately 7% more volatile than PDD relative to the S&P 500. On balance sheet safety, PDD Holdings Inc. (PDD) carries a lower debt/equity ratio of 3% versus 169% for MercadoLibre, Inc. — giving it more financial flexibility in a downturn.
05Which has better profit margins — MELI or PDD?
PDD Holdings Inc. (PDD) is the more profitable company, earning 28.5% net margin versus 6.9% for MercadoLibre, Inc. — meaning it keeps 28.5% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: PDD leads at 27.5% versus 11.1% for MELI. At the gross margin level — before operating expenses — PDD leads at 60.9%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is MELI or PDD more undervalued right now?
On forward earnings alone, PDD Holdings Inc. (PDD) trades at 1.2x forward P/E versus 30.8x for MercadoLibre, Inc. — 29.6x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for MELI: 59.9% to $2810.00.
07Which pays a better dividend — MELI or PDD?
None of the stocks in this comparison currently pay a material dividend. All are effectively zero-yield and should be held for capital appreciation rather than income.
08Is MELI or PDD better for a retirement portfolio?
For long-horizon retirement investors, MercadoLibre, Inc. (MELI) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.88), +1628% 10Y return). Both have compounded well over 10 years (MELI: +1628%, PDD: +288.5%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between MELI and PDD?
Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. In terms of investment character: MELI is a mid-cap quality compounder stock; PDD is a large-cap deep-value stock. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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