MercadoLibre, Inc. (NASDAQ:MELI) shares are trading lower Monday after B of A Securities downgraded the stock and lowered its price target.
What To Know: B of A Securities analyst Robert Ford downgraded the stock from Buy to Neutral and lowered its price target from $1680 to $1350.
Ford highlighted the disruptive implications of the company’s new cross-border tax rule, in which eCommerce purchases of up to US$50 are exempt from a 60% import tariff. The effects could be seen across many categories, especially fashion.
Policy makers may attempt to address the new rule, but doing so may be unpopular with Brazilian voters.
While tax-exempt cross-border offers challenge MELI competitively, there are cross-border opportunities which the company can shift towards, although there are obstacles to that pivot such as the time it would take.
According to data from Benzinga Pro, MELI stock experienced above-average trading volume of 1.2 million shares on Monday compared to its average volume of 431,009.
Related Link: What’s Going On With Teladoc Stock Today
MELI Price Action: Shares of MELI were down 5.59% at $1,089.28 at the time of publication, according to Benzinga Pro.
Image by Tumisu from Pixabay
