MercadoLibre Stake Liquidated: A Cautionary Note

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On February 4, 2026, Aubrey Capital Management Ltd. registered a complete divestment of its holdings in MercadoLibre (MELI 2.30%). The transaction, involving the sale of 5,638 shares, is estimated at $13.18 million, calculated on the basis of average quarterly pricing for the period ending December 31, 2025. It is a transaction that warrants a closer look, not for its scale – substantial though it is – but for what it suggests about the prevailing currents in the market.

The Divestment

The filing with the Securities and Exchange Commission reveals that Aubrey Capital Management Ltd. effectively eliminated its stake in MercadoLibre, reducing its holdings to zero. The estimated value of the transaction, $13.18 million, represents 4.15% of the fund’s assets under management. The decline in value, while significant, is perhaps less remarkable than the decision itself.

Further Considerations

The fund’s complete exit from MercadoLibre leaves no residual position within its reportable assets. This is not a mere trimming of exposure; it is a decisive break. As of February 3, 2026, MercadoLibre shares were priced at $2,099.90, a figure which, while showing a year-on-year increase of 10.0%, underperforms the S&P 500 by a margin of 5.4 percentage points. This discrepancy, however small, should not be dismissed.

The fund’s total reportable assets under management stood at $254.07 million across 53 positions at quarter’s end, reflecting a 20% reduction in fund size compared to the previous quarter. This downsizing, coupled with the MercadoLibre divestment, suggests a broader reassessment of portfolio strategy.

Company Overview

Metric Value
Price (as of market close February 3, 2026) $2,099.90
Market Capitalization $106.46 billion
Revenue (TTM) $26.19 billion
Net Income (TTM) $2.08 billion

A Snapshot of the Company

  • MercadoLibre operates e-commerce marketplaces, provides digital payment solutions (Mercado Pago), offers credit facilities, manages logistics networks, and provides advertising platforms across Latin America.
  • Revenue is generated through transaction fees, fintech services, advertising revenue, logistics charges, and value-added services for both merchants and consumers.
  • The company serves businesses, merchants, and individual consumers primarily in Latin American markets, catering to both online buyers and sellers.

MercadoLibre is, undeniably, a dominant force in Latin American e-commerce and fintech. Its integrated platform offers scale and user engagement. However, the pursuit of growth, particularly in logistics, has come at a cost. The company’s operating margins have fallen from nearly 13% to under 10%, a decline that cannot be ignored.

What This Transaction Signifies

Aubrey Capital Management’s decision to liquidate its entire MercadoLibre stake, valued at over $13 million, during the fourth quarter of 2025, should not be viewed in isolation. While MercadoLibre shares have shown considerable growth since 2023 – a 77% increase equating to a compound annual growth rate of 20.9% – recent performance has been less assured. Shares have slipped by 11% over the last six months, a fact that likely contributed to the fund’s decision.

The primary concern centers on the company’s expansion of its logistics network and the resulting impact on profitability. The market, it seems, is beginning to question whether the promised returns will materialize. Revenue has increased from $22.4 billion to $26.2 billion over the last twelve months, but this growth has not yet translated into improved margins.

For investors, this presents a conundrum. MercadoLibre remains a rapidly expanding e-commerce company. The decline in share price may offer an opportunity to acquire stock at a more favorable price, but it is a gamble predicated on the assumption that the company’s logistics investments will eventually pay off. A cautious approach, informed by a clear understanding of the risks involved, is advisable.

Top holdings after the filing:

  • NASDAQ: FUTU: $20.20 million (8.0% of AUM)
  • NYSE: EMBJ: $20.02 million (7.9% of AUM)
  • NYSE: NU: $18.81 million (7.4% of AUM)
  • NYSE: LTM: $18.51 million (7.3% of AUM)
  • NYSE: BABA: $15.58 million (6.1% of AUM)

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2026-02-04 21:34