Buying growth stocks at a discount can be a rewarding strategy, especially if the companies in question remain competitively positioned for long-term growth. MercadoLibre (NASDAQ: MELI) and Coupang (NYSE: CPNG) trade 26% and 68% below their highs, respectively, yet their competitive advantages remain intact, and both are still delivering double-digit percentage revenue growth.
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1. MercadoLibre
MercadoLibre shares are down by about 26% from their peak, even as the company just posted a standout 43% year-over-year revenue increase on a constant-currency basis in the second quarter. As Latin America’s leading e-commerce and fintech platform, it has sustained strong growth for years.
The company’s edge comes from combining its online marketplace with a fast-growing financial services ecosystem that includes payments and credit tools. The marketplace reached 89 million unique active buyers last quarter, up 26% year over year, while the fintech platform had 88 million monthly active users, up 30%. That tight integration is hard for competitors to replicate, which helps explain MercadoLibre’s long track record of growth.
Management continues to strengthen the flywheel by offering benefits that work across both platforms. Its loyalty program, for instance, links marketplace perks like free shipping with fintech rewards such as cashback, increasing engagement and customer retention.
MercadoLibre also wins on logistics. With a growing warehouse footprint in Brazil, it has improved its delivery speed and expanded the scope of its free shipping offers. After it lowered the minimum purchase requirement for free shipping last year, items sold per buyer rose 19% year over year in Q2.
The stock’s recent pullback reflects the market’s worries about the margin pressure MercadoLibre is facing. However, management continues to prioritize long-term gains over short-term profits. Long-term investors will appreciate that its investments in free shipping, delivery infrastructure, and credit cards are intended to widen its competitive moat and deepen its customer relationships. That’s a good reason to buy the dip.
Moreover, the company’s advertising revenue, which grew by over 70% last quarter, could be a catalyst for margin expansion over the next decade.
Trading at about 2.8 times trailing sales, below its three-year average of 4.6 times, the stock looks appealing, particularly for a business still growing at this pace. The dip offers a chance to buy a proven long-term compounder at a discount.
2. Coupang
Coupang shares are down roughly 68% from their early all-time high in 2021, and have slumped by about 52% from their 52-week high as revenue growth has slowed over the past year. A data breach incident disrupted customer shopping behavior and weighed on momentum. Even so, revenue rose 10% year over year in Q2 on a currency-adjusted basis, compared to the 14% growth it delivered in 2025.
Coupang is headquartered in Seattle, but primarily operates in South Korea, where it remains the dominant e-commerce player. Its advantages in that market are difficult for rivals to replicate. Building a fast delivery network in a nation of dense cities filled with apartment buildings is expensive and complex, yet Coupang has done it — and it delivers about 99% of orders within one day or faster.
Its moat is reinforced by its delivery infrastructure, warehouse automation, and its WOW membership program, which bundles free shipping, food delivery, streaming, and other perks. Once customers join, they tend to spend more with Coupang over time. Coupang’s longest-tenured WOW members — those acquired more than a decade ago — now spend nearly 10 times what they did in year one, a strong sign of both the platform’s stickiness and the limited nature of the alternatives.
That also helps explain the speed of its recovery from its data breach incident: Many customers who left have returned, and their spending has climbed above pre-incident levels.
Product commerce active customers increased 3% year over year to 24.7 million in Q2. Coupang is also applying its Korea strategy to Taiwan, which continues to show promise, with the business growing at a pace comparable to what it achieved in South Korea during its early years of expansion there.
With the stock trading at about 0.8 times sales — roughly half its P/S ratio before the data breach incident — it looks cheap. As the sting of that incident fades and WOW membership expands, growth could reaccelerate, giving investors who buy at today’s discount a chance at excellent returns over the next decade.
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John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends MercadoLibre. The Motley Fool recommends Coupang. The Motley Fool has a disclosure policy.
