Best Buys Now May 2025
It's a bit tougher now
Hi Multis
It's the 15th of the month and experienced Multis know what that means: the Best Buys Now.
To be honest, I tinkered and pondered a lot for this one. This is the reason.
The average pick of the last Best Buys Now of a month ago, is up 40%.
If I leave out the cash position, it was even +50%. In a month! I added three stocks 'To consider.' They are up 21% on average as well.
The average of the Best Buys Now of March, a month before that? Also +25%.
That means two things:
It will be impossible to match these results now.
Many of the stocks that were very interesting then are not anymore right now. It's not that their intrinsic value suddenly rose 40% in a month. It is multiple expansion.
So... what to do now?
Well, I made a list with stocks that I find attractive right now. It just took a bit more work.
And it's not just a random list. I will buy these with my own money after the market has opened. I always put my money where my mouth is.
So, let's go over the positions one by one.
1. Mercado Libre
Before you click this article away because I select a stock that's up 51% year-to-date, look at Mercado Libre's (MELI) valuation.
A forward P/FCF of just above 17 times and a current P/OCF of just below 17 times does that look expensive to you? For a company that grew its revenue by 37% again?
And look at the forward PEG ratio.
The 2025 PEG is still 1.61, which is seen as 'fair.' For a company that has delivered for decades, fair is where it's obligatory for every serious stock investor to quote Warren Buffett.
I think Mercado Libre is a wonderful company. For this year, you pay a fair price, but for the next years, I think you also pay a wonderful price.
The 2026 PEG stands at 1.11. Fair, but bordering cheap, especially if Mercado Libre beats the estimates, as it almost always does.
The 2027 PEG is below 1, at 0.89, and the 2028 PEG, of course the most uncertain one, stands at just 0.74.
If you are a long-term investor, as I am, I don't think you should be scared to buy Mercado Libre at this point. Could it drop? Sure. Could it keep going up so you miss the drop you expect? Of course.
That's why I will add to my position again, even though this is already my biggest position. The stock has been good for me for years and I see no reason why that would change in the future.