Growth Stocks: A Modest Proposal

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So, a ‘growth stock’, is it? The common definition involves charts going ‘up’. As if the universe particularly cares which way a line on a piece of parchment points. No. A growth stock, properly understood, is merely a business that hasn’t yet collapsed under the weight of its own ambitions. It’s a fragile thing, really. Like a particularly enthusiastic gnome attempting to build a tower out of custard. One must look beyond the flickering candle of the share price and examine the foundations. Because, as any seasoned observer of human folly knows, a rising tide lifts all boats… until it inevitably crashes into the rocks.

And it is in the moments after the crash, when the wreckage is still steaming, that the truly discerning investor begins to rummage for salvage. Here are two such opportunities, presented with the usual caveats about market irrationality and the inherent unpredictability of everything. Don’t say we didn’t warn you when the gnomes revolt.

MercadoLibre: The Alchemist’s Workshop

Behold, MercadoLibre (MELI +1.01%). A sprawling, multifaceted enterprise operating in the lands of Mexico and Brazil, dealing in both the exchange of goods and the arcane art of ‘fintech’ – which, as far as we can tell, involves moving numbers around on screens with alarming speed. They’re rather good at it, actually. A bit like a particularly efficient guild of alchemists, turning base desires into glittering… well, more desires.1

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Their latest reports speak of ‘skyrocketing growth’ – a phrase that should always be met with suspicion. Net revenue increased by 47% – which, while impressive, is merely a symptom of the relentless march of commerce. The commerce side grew 40%, the fintech side 51%. They reinforce each other, apparently. It’s a virtuous cycle, they claim. We suspect a small, overworked imp is involved somewhere. Argentina, a land recently afflicted by ‘hyperinflation’ (a condition best described as ‘money becoming rapidly less useful’), is showing signs of recovery. This, naturally, benefits MercadoLibre. It always does.2

Long-term, the opportunity is immense. E-commerce penetration in Latin America is still relatively low, meaning there’s plenty of room for growth. Wall Street is currently displeased that MercadoLibre is investing in the future, preferring short-term profits. This is a common ailment among those who mistake counting beans for building empires. They’ll understand… eventually. Or they won’t. It rarely makes much difference.

Wix.com: The Website Weaver’s Loom

Now, Wix.com (WIX 1.19%). A company currently being thrashed by the market, accused of being… obsolete. The charge? That ‘artificial intelligence’ (a term we use loosely, as it implies actual intelligence) will render website builders unnecessary. The logic is… questionable.3

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The fear is that AI coding agents will build websites for people. But Wix already allows you to build a website without coding. It’s rather the point. And its customers aren’t exactly clamoring for cutting-edge software. They’re small businesses – restaurants, plumbers, people who just want a simple online presence. They’re more concerned with keeping the lights on than embracing the latest technological marvels. A perfectly reasonable stance, if you ask us.

The disruption risk is wildly overblown. Wix, to its credit, is preparing for the inevitable. It acquired Base44, a ‘vibe coding application builder’ (whatever that is). Base44 went from zero revenue to over $50 million in annual recurring revenue in a single year. That’s… unusual. It suggests someone knows something we don’t. Or they’re very good at marketing. Either way, it’s a positive sign.

With Wix stock down 82% from its all-time highs, now might be a good time to buy. It’s still accelerating top-line growth, despite the market’s best efforts to drag it down. It’s a gamble, of course. But then, isn’t everything?

1

The Guild of Alchemists and Venture Capitalists are notoriously secretive about their methods. Rumors abound of enchanted spreadsheets and rituals involving copious amounts of coffee.

2

Argentina’s economic cycles are best understood as a series of dramatic swings between prosperity and utter chaos. It’s quite a spectacle, really.

3

The notion that a machine can replicate human creativity is, frankly, absurd. But then, humans are easily impressed by shiny things.

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2026-03-01 19:52