Amazon has been one of the best-performing stocks in the history of the stock market, and new advances in artificial intelligence (AI) have created a new wellspring of opportunity for the e-commerce king.

However, while Amazon may continue to grow and gain, there's another e-commerce company that's growing faster and might have even greater opportunities. If you're looking for a powerhouse growth stock with massive potential, consider MercadoLibre stock (NASDAQ: MELI).

More incredible performance from this e-commerce giant

It's not easy to boast high sales growth for long periods of time, but MercadoLibre continues to wow the market with consistently high revenue increases. They accelerated early in the pandemic to triple-digit numbers, and now they've decelerated comfortably into high double digits.

Since MercadoLibre is headquartered and operates in Latin America, it reports numbers both actual and currency-neutral. These two sets of metrics aren't usually all that different, but recently there's been wide divergence for international companies, and it's important for investors to keep both sets of numbers in mind.

Revenue increased 36% year-over-year in the 2024 first quarter, not too bad, but 94% currency neutral, which is outstanding.

MercadoLibre's main business is e-commerce, and gross merchandise volume (GMV) increased 71% year over year (currency neutral) in the first quarter, driven by a 25% increase in items sold. MercadoLibre operates in 18 Latin American countries, and while they're all in the same overall region, they have varied economies and provide a level of diversification to its business. There was major economic pressure in Argentina during the first quarter, and GMV growth in Argentina was 215%, which was below the rate of inflation, with a 4% decline in items sold. Unique active user growth decelerated to 1.5%. However, a strong showing in its two other large markets, Brazil and Mexico, largely offset these slowdowns. Items sold per unique buyers increased 7% year over year.

The company has expanded into offering fintech services, and this is its fastest-growing segment. Total payment volume increased 35% year over year in the quarter, or 85% currency-neutral. Fintech's monthly active users increased 38% year over year, and the credit portfolio increased 46% to $4.4 billion.

MercadoLibre is still in a high-growth phase, but it's demonstrating consistent profitability. Net income increased by more than 70% year over year in the first quarter with a 7.9% margin.

Growth strategies and opportunities

MercadoLibre is still much smaller than Amazon, with only $14.5 billion in trailing-12-month sales vs. Amazon's $591 billion. It can enjoy years of high growth and still remain a smaller company, which gives it decades of growth opportunities and potential for shareholder gains.

Some of its initiatives are similar to those of Amazon. It offers its own fulfillment network, and as more suppliers use it, it can get deliveries out faster and cheaper. It recently launched Meli+, which is similar to Amazon Prime, and members are engaging and spending more. It also recently rolled out its own innovation, Meli Delivery Day, which is like allowing shoppers to use the slower (and sometimes cheaper) option on Amazon, with the twist of having a specific day of the week when shoppers get all of their shipments.

Its focus is currently on e-commerce and fintech, unlike Amazon's more diversified portfolio of businesses. However, MercadoLibre entered the fintech space after becoming a leader in e-commerce, a natural complement to its business because shoppers needed alternative payment methods. It has been growing that business in new directions, such as credit cards and other credit products. There isn't any pressure to go further because it's still in a powerful and early growth phase in its current circumstances, but it could enter new spaces that align with its mission and business. It has already invested in other early-stage companies in Latin America, pumping up its financial portfolio.

The opportunities seem nearly limitless right now, and management is boosting the top line while carefully expanding the bottom line. That's evidence of an excellent business, and MercadoLibre stock is a great candidate for the growth-oriented portfolio.

Should you invest $1,000 in MercadoLibre right now?

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Jennifer Saibil has positions in MercadoLibre. The Motley Fool has positions in and recommends Amazon and MercadoLibre. The Motley Fool has a disclosure policy.

Forget Amazon; Buy This Unstoppable Growth Stock Instead was originally published by The Motley Fool