6 Undervalued Businesses with a Strong Moat
1/ $MercadoLibre(MELI)$
$MELI is the best company in Latin America, which is down over 30% from June highs.
The company maintains a powerful moat through its integrated ecosystem, which locks in users by seamlessly combining:
- E-commerce
- Fintech
- Loans
- Logistics
This creates a massive network effect where a growing buyer base attracts more merchants, while its proprietary logistics network provides a level of delivery speed and reliability.
Key Segments are exploding:
E-com Services $2.3B ➡️ $12.8B
E-com Products $255M ➡️ $3.5B
Fintech $1.1B ➡️ $6.7B
Credit $246M ➡️ $5.9B
- 78M Fintech Users
- 121M E-com Buyers
- $65B GMV
2/ $Alphabet(GOOGL)$
$GOOGL is the best positioned to thrive in the AI age. Its moat is built on a data-driven feedback loop, generating an unmatched volume of data that continuously refines its algorithms and ad targeting.
This dominance is reinforced by a multi-layered ecosystem consisting of:
- AI
- Search
- Cloud
- YouTube
- Android
- Waymo
Key Segments are delivering:
Search $69.8B ➡️ $224.5B
YouTube $8.2B ➡️ $40.4B
Google Network $17.6B ➡️ $29.8B
Subscriptions, Platforms $10.9B ➡️ $48B
Cloud $4.1B ➡️ $58.7B
3/ $Uber(UBER)$
$UBER is down 25% from October because of AI disruption fears, yet they are well-positioned to become a platform for robotaxi deployment.
Their moat comes from 202M customers spending $193B on Uber's platform.
The company maintains its dominance through a powerful two-sided network effect, where a massive pool of drivers ensures low wait times for riders, which in turn attracts even more drivers to the platform’s high demand. This scale is further fortified by its cross-platform ecosystem, as the integration of ride-sharing, food delivery, and freight services lowers customer acquisition costs and increases user stickiness.
Getting customers to download another app is a tall order.
As robotaxi technology gets better, deploying it on Uber is the easiest way to monetise it, as Uber owns the customers.
Key Segments are delivering:
Mobility $7.3B ➡️ $29.7B
Delivery $587M ➡️ $17.2B
Freight $67M ➡️ $5.1B
4/ $Meta Platforms, Inc.(META)$
$META controls the attention of the world.
- 3.58B Daily Users
The moat is built on unrivaled social network effect, where a massive global user base creates high switching costs and a gravity that compels new users to join where their connections already exist. This is bolstered by a vast data and AI infrastructure.
Their platform is primed for AI deployment, creating new services, increasing user stickiness and driving higher return on advertising spend.
5/ $SoFi Technologies Inc.(SOFI)$
$SOFI moat is driven by its vertically integrated technology stack. Their "AWS of Fintech" arm licenses core banking, payments, and card processing infrastructure to other financial institutions, which guarantees the best banking tech for Sofi.
This is complemented by a financial services flywheel, where a member-centric One-Stop-Shop strategy drives high cross-selling, significantly lowering customer acquisition costs as users expand from basic checking accounts into high-value lending and investment products.
Key Segments are growing quickly:
Lending $267M ➡️ $1.85B
Tech Platform $0 ➡️ $450M
Financial Services $1M ➡️ $1.54B
6/ $Nu Holdings Ltd.(NU)$
$NU moat is built on a low-cost structural advantage, where its cloud-native infrastructure allows it to serve millions of customers at a fraction of the cost of traditional legacy banks.
Growth has been incredible:
Customers 6M ➡️ 131M
Deposits $600M ➡️ $41.9B
Purchase Volume $9.6B ➡️ $141.8B
ARPU $7 ➡️ $13.3
Net Income -$29M ➡️ $2.9B
For SG users only, Welcome to open a CBA today and enjoy access to a trading limit of up to SGD 20,000 with unlimited trading on SG, HK, and US stocks, as well as ETFs.
🎉Cash Boost Account Now Supports 35,000+ Stocks & ETFs – Greater Flexibility Now
Find out more here.
Complete your first Cash Boost Account trade with a trade amount of ≥ SGD1000* to get SGD 688 stock vouchers*! The trade can be executed using any payment type available under the Cash Boost Account: Cash, CPF, SRS, or CDP.
Other helpful links:
-
💰Join the TB Contra Telegram Group to Get $10 Trading Vouchers Now🎉
-
How to open a CBA. How to link your CDP account. Other FAQs on CBA. Cash Boost Account Website.
Comments