Mercado Libre is traded at $ 90,000 million and is Latin America’s most valued company

The plummeting iron ore prices cost Brazilian producer Vale SA around $ 40 billion in market capitalization and the title of the most valued company in Latin America. In this context, Vale’s 32% collapse from its peak at the end of July means the Rio de Janeiro-based miner is worth less than Mercado Libre, the e-commerce tech giant now worth $ 90 billion after a strong performance in financial technology which recorded the last quarter, As reported Bloomberg.

The change of position, where a platform of the new economy takes first place from a producer of raw materials with 79 years of history, It can be seen consolidating after Chinese efforts to clean up its heavily polluting industrial sector caused iron ore to drop below $ 100 per metric tonne.

Last week, UBS Group AG slashed Vale’s buy-sell recommendation by two places, while Bradesco BBI believes the risks in a volatile commodity price environment are biased downward. If iron ore averages $ 90 next year, Vale’s pre-game profits may fall short of consensus estimates of 38%.

Vale’s change in fortunes could have been even more dire without the massive investor payouts of $ 13.8 billion announced so far this year, the agency noted.

Vale, one of the world’s largest producers and exporters of iron. According to the agency EFE, the company has maintained its forecast that it will end 2021 with production of between 315 and 335 million tonnes of iron.

Recall that Vale produced a record 384.6 million tonnes of iron in 2018, but its production fell to 301.9 million tonnes in 2019 due to the damage caused by the environmental disaster at its Brumadinho mine and until to 300.4 million tonnes in 2020 due to the shutdown of certain mines’ activities due to the pandemic.

The Brazilian multinational based in the city of Rio de Janeiro operates in the mining, logistics, steel, energy and oil sectors, and is one of the largest logistics operators in Brazil. It is also the second largest mining company in the world, and the largest producer of iron in the world and the second in Nickel.

Mercado Libre revenues

Mercado Libre released its financial results for the second quarter of 2021 in August in which it achieved a net profit of $ 1.7 billion, representing an increase of 93.9% in dollars and 102.6% in foreign currencies. constant.the company said in its quarterly report to the United States Securities and Exchange Commission (SEC).

During those months, e-commerce business revenue grew 96.4% year-over-year in dollars, reaching $ 1,142.3 million, while Mercado Pago’s revenue, the company’s fintech business, grew 88.9% year-over-year in dollars. , reaching $ 560.4 million.

“Gross profit for the quarter was $ 753.9 million, with a margin of 44.3%, compared to 48.6% in the same quarter last year.The company said in the report.

During the same period, the platform’s unique active user base reached 75.9 million, so its users grew 47.4% year-on-year from 51.5 million a year ago. year.

The total value of items processed during the quarter was $ 7,000 million, representing an annual growth of 39.2% in dollars and 46.1% in constant currency, of which 73.4% came from transactions made from mobile devices.

“Mercado Libre achieved another quarter of strong growth in our e-commerce and fintech businesses, reaching record levels in volume and revenue. This performance builds on a strong first quarter that we have experienced this year, ”said Pedro Arnt, Chief Financial Officer of the company.

KEEP READING: