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How to Valuate Mercado Libre
Free cash flow is considered more valuable than earnings for valuing Mercado Libre./nMercado Libre's reported free cash flow is much higher than its reported net income./nProvisions for credit losses add complexity to evaluating Mercado Libre./nConsider the growth rate and profitability of the business when evaluating Mercado Libre./nPrice to free cash flow ratio for Mercado Libre is about 17, while the PE ratio is about 98./nThe valuation of Mercado Libre is influenced by its growth potential and execution.