The Market Is Down -- Here's Which Stock Between Amazon and MercadoLibre to Buy First
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By Will Healy – Apr 5, 2026 at 7:05AM ESTKey PointsAmazon leads the way in e-commerce and cloud computing, but massive artificial intelligence (AI) and cloud-related investments may have worried some investors.MercadoLibre is adept at turning challenges into business opportunities, but rising expenses dampened profit growth last year.Investors deciding between buying Amazon (AMZN 0.41%) and MercadoLibre (MELI 0.28%) face a challenge in deciding between similar stocks. Both made their name by pioneering e-commerce in their respective regions before finding success with other businesses. Amazon led the way in cloud computing, while MercadoLibre's fintech arm has helped change how consumers spend money in Latin America. Knowing those things, the question now is which top e-commerce company is a better buy in a down market. Let's take a closer look. Image source: The Motley Fool. Amazon vs. MercadoLibre Indeed, both stocks are down from their highs, with Amazon off 16% and MercadoLibre trading 34% below its peak. For now, both its size and proven business model may give Amazon an edge. It balances a sizable e-commerce business with the world's first and largest cloud computing operation. Since the e-commerce operation sells just about anything, it holds some degree of recession resistance. Also, cloud migrations and the massive demand for artificial intelligence (AI) continue to fuel AWS's growth. However, Amazon pledged $200 billion on capital expenditures (capex) this year, up from $131 billion in 2025. Even though Amazon holds $123 billion in liquidity, that spending could hurt Amazon if AI growth suddenly slowed. Fortunately, that spending has not hurt its growth. In 2025, net sales rose by 12% year over year, while net income surged by 31%. When factoring in Amazon's unusually low 30 P/E ratio, it could draw in investors. ExpandNASDAQ: AMZNAmazonToday's Change(-0.41%) $-0.87Current Price$209.70Key Data PointsMarket Cap$2.3TDay's Range$204.93 - $212.2252wk Range$161.38 - $258.60Volume1.3MAvg Vol51MGross Margin50.29% In contrast, MercadoLibre has succeeded by turning Latin America's challenges into successful business enterprises. It created Mercado Pago so its cash-dependent customers could buy online. Now, that enterprise is the region's leading fintech company. It was a similar story with Mercado Envios, when it turned a lack of options to quickly ship goods into a successful shipping and fulfillment operation. Unfortunately, rising e-commerce competition from Amazon and others has squeezed margins in that part of the business. Also, Mercado Pago's aggressive growth in the fintech market led to a huge spike in the provision for doubtful accounts, which covers loans lenders did not pay back. Consequently, the company's 44% yearly revenue growth in 2025 translated into a profit increase of less than 5% for the same period. That lower earnings growth may also make its 44 P/E ratio seem high. Nonetheless, its $87 billion market cap is a small fraction of Amazon's market cap of $2.3 trillion. Considering that Amazon routinely sold at a higher P/E ratio in its earlier years, one could argue that MercadoLibre now sells at a reasonable valuation. ExpandNASDAQ: MELIMercadoLibreToday's Change(-0.28%) $-4.88Current Price$1714.09Key Data PointsMarket Cap$87BDay's Range$1685.42 - $1735.2752wk Range$1593.21 - $2645.22Volume14KAvg Vol593KGross Margin44.50% Which stock should investors buy? When comparing the two stocks, MercadoLibre appears to hold more growth potential in percentage terms. Its smaller size allows it to grow its revenue more quickly, and the P/E ratio is arguably low for a fast-growing e-commerce conglomerate. However, Latin America is a riskier region, and Amazon posts solid growth numbers considering its size. Thus, it remains a likely market beater, which arguably makes Amazon a more suitable choice for risk-averse investors.Read NextApr 5, 2026 •By John BallardAfter Nike's Drop, Here Are the 3 Retail Growth Stocks I'd Buy TodayApr 4, 2026 •By Lyle DalyThe Largest Consumer Discretionary Companies by Market Cap in April 2026Apr 3, 2026 •By Geoffrey SeilerBrilliant Buys for Uncertain Times: 2 Growth Stocks to Own for the Long TermApr 2, 2026 •By Daniel SparksGot $1,000? 1 Artificial Intelligence (AI) Stock to Buy and Hold for the Next Decade and BeyondApr 2, 2026 •By Danny Vena, CPAAmazon is Considering a $9 Billion Deal to Acquire Satellite Communications Company Globalstar. Here's Why Amazon, Apple, and Tesla Investors Should Pay Attention.Apr 2, 2026 •By Jennifer SaibilAmazon vs. Apple: Which Is the Better Artificial Intelligence (AI) Stock to Buy Today?About the AuthorWill Healy is a contributing Motley Fool stock market analyst covering technology and consumer goods industries.
Before The Motley Fool, Will was a freelance writer covering stocks and personal finance for MSN Money, Yahoo! Finance, and Nasdaq. Earlier in his career, he was an expert in geographic information systems, applying spatial and IT skills to perform RF and demographic analysis in the telecom industry. He holds a bachelor’s degree in journalism from Texas A&M University and an MBA in finance and strategy from the University of Texas at Dallas.TMFWillHealyX@HealyWritingStocks MentionedAmazonNASDAQ: AMZN$209.70(-0.41%)-$0.87MercadoLibreNASDAQ: MELI$1,715.52(-0.20%)-$3.45*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.