Reviewing Hour Loop (NASDAQ:HOUR) & MercadoLibre (NASDAQ:MELI)

MercadoLibre (NASDAQ:MELI) and Hour Loop (NASDAQ:HOUR) are both retail/wholesale companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Volatility and Risk

MercadoLibre has a beta of 1.48, indicating that its share price is 48% more volatile than the S&P 500. Comparatively, Hour Loop has a beta of 1.43, indicating that its share price is 43% more volatile than the S&P 500.

Profitability

This table compares MercadoLibre and Hour Loop’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MercadoLibre	6.91%	33.73%	5.71%
Hour Loop	0.59%	12.96%	3.57%

Valuation & Earnings

This table compares MercadoLibre and Hour Loop”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MercadoLibre	$28.89 billion	3.12	$2.00 billion	$39.40	45.19
Hour Loop	$138.25 million	0.49	$660,000.00	$0.03	64.00

MercadoLibre has higher revenue and earnings than Hour Loop. MercadoLibre is trading at a lower price-to-earnings ratio than Hour Loop, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for MercadoLibre and Hour Loop, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MercadoLibre	0	3	15	1	2.89
Hour Loop	1	0	0	0	1.00

MercadoLibre presently has a consensus price target of $2,785.33, indicating a potential upside of 56.45%. Given MercadoLibre’s stronger consensus rating and higher probable upside, equities analysts plainly believe MercadoLibre is more favorable than Hour Loop.

Insider and Institutional Ownership

87.6% of MercadoLibre shares are held by institutional investors. Comparatively, 0.3% of Hour Loop shares are held by institutional investors. 0.3% of MercadoLibre shares are held by insiders. Comparatively, 95.0% of Hour Loop shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

MercadoLibre beats Hour Loop on 13 of the 15 factors compared between the two stocks.

About MercadoLibre

MercadoLibre, Inc. operates online commerce platforms in the United States. It operates Mercado Libre Marketplace, an automated online commerce platform that enables businesses, merchants, and individuals to list merchandise and conduct sales and purchases digitally; and Mercado Pago FinTech platform, a financial technology solution platform, which facilitates transactions on and off its marketplaces by providing a mechanism that allows its users to send and receive payments online, as well as allows users to transfer money through their websites or on the apps. The company also offers Mercado Fondo that allows users to invest funds deposited in their Mercado Pago accounts; Mercado Credito, which extends loans to certain merchants and consumers; and Mercado Envios logistics solution that enables sellers on its platform to utilize third-party carriers and other logistics service providers, as well as fulfillment and warehousing services for sellers. In addition, it provides Mercado Libre Classifieds, an online classified listing service, where users can list and purchase motor vehicles, real estate, and services; Mercado Ads, an advertising platform, which enables large retailers and brands to promote their products and services on the web; and Mercado Shops, an online storefronts solution that enables users to set-up, manage, and promote their own digital stores. The company was incorporated in 1999 and is headquartered in Montevideo, Uruguay.

About Hour Loop

Hour Loop, Inc., an online retailer, engages in e-commerce retailing in the United States. The company sells products in various categories, including home/garden décor, toys, kitchenware, apparels, and electronics products. It sells its products through hourloop.com, as well as third-party marketplaces. Hour Loop, Inc. was founded in 2013 and is headquartered in Redmond, Washington.