Founded in Argentina in 1999, this featured stock idea is the "eBay" of South America, explains Mike Cintolo, editor of Cabot Top Ten Trader.

MercadoLibre (MELI) operating in 12 South and Central American countries and Portugal (Brazil’s connection to the old country). Brazil accounts for 44% of revenues, Argentina 26%, Venezuela 18%, and Mexico 7%.

As on eBay, sellers can use an auction system or a fixed-price system, and on MercadoLibre, 80% use fixed-price. eBay has been a major shareholder of MercadoLibre since 2001 and today it owns 18.4% of the company.

Revenues have grown every year of the past decade and earnings have grown every year of the past nine.

This year, earnings are expected to decline, in part due to currency exchange rates, but analysts are looking for a huge rebound next year, which is one reason the stock is up.

The other reason is that bigger fish, namely eBay, Amazon.com, and Alibaba, have all been mentioned as possible acquirers of MercadoLibre.

MELI came public in 2007 and plunged to new lows in the broad 2008 market collapse but then embarked on a five-year run that took it to a high of 146 late last year.

The sellers then took control, driving MELI down to a low of 80 this May, but since then the bulls have been back in control.

Most impressive, especially considering the action of the broad market, has been the stock’s action over the past six weeks.

From its early September high of $118, the stock pulled back to bottom at $108 (a modest 8% decline) two weeks ago and has held up while the broad market has fared much worse. Technically, therefore, there’s a lot of support here.

Venturesome investors could dip a toe in here.

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