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Investors that missed an opportunity to invest in companies like Amazon (AMZN), Apple (AAPL), Costco (COST), and Chipotle Mexican Grill (CMG) are always on the lookout for the next Amazon or the next Chipotle. Every once in a while they find a company like MercadoLibre (MELI) that turns out to be the Amazon of Latin America but more often than not, they run into a Jumia Technologies (JMIA) or Potbelly (PBPB). To paraphrase a quote I heard a while ago, “more money has been lost trying to find the next Amazon; than made by investors in Amazon”.
While considering candidates for our Buyback Wednesdays article this week, I came across a $100 million share repurchase announcement by a company called dLocal Limited (DLO). The size of the purchase in relation to the company’s market cap was not significant (2.57% of market cap at announcement) but dLocal appeared to be a fast-growing FinTech company with amazing margins. The company facilitates payments in Latin America and several other countries across the globe. This was beginning to sound like another MercadoLibre or better yet, the “PayPal of Latin America”.