Mercadolibre Inc. (MELI): Today's Featured Diversified Services Laggard

Mercadolibre ( MELI) pushed the Diversified Services industry lower today making it today's featured Diversified Services laggard. The industry as a whole closed the day down 0.5%. By the end of trading, Mercadolibre fell $5.71 (-7.5%) to $70 on heavy volume. Throughout the day, 2.1 million shares of Mercadolibre exchanged hands as compared to its average daily volume of 658,700 shares. The stock ranged in price between $67.78-$72 after having opened the day at $70.07 as compared to the previous trading day's close of $75.71. Other company's within the Diversified Services industry that declined today were: American Learning ( ALRN), down 12.9%, New Oriental Education & Technology Group I ( EDU), down 8.8%, ITT Educational Services ( ESI), down 7.9%, and Education Management Corporation ( EDMC), down 7.8%.

MercadoLibre, Inc., together with its subsidiaries, hosts online commerce and payments platforms in Latin America. Its services are designed to provide its users with mechanisms to buy, sell, pay for, and collect on e-commerce transactions. Mercadolibre has a market cap of $3.23 billion and is part of the services sector. The company has a P/E ratio of 39.4, above the average diversified services industry P/E ratio of 39.2 and above the S&P 500 P/E ratio of 17.7. Shares are down 4.8% year to date as of the close of trading on Friday. Currently there are four analysts that rate Mercadolibre a buy, one analyst rates it a sell, and three rate it a hold.

TheStreet Ratings rates Mercadolibre as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the positive front, China HGS Real Estate ( HGSH), up 27.9%, Green Dot ( GDOT), up 12.5%, eLong ( LONG), up 9.2%, and Ambow Education ( AMBO), up 8.4%, were all gainers within the diversified services industry with SAIC ( SAI) being today's featured diversified services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the diversified services industry could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the diversified services industry could consider ProShares Ultra Short Consumer Sers ( SCC).
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