2 Stocks That Could Be Easy Wealth Builders

In a sense, the market does not offer "easy" solutions for wealth building. Even the highest-quality stocks deal with uncertainty and volatility that can dramatically affect the stock price.

However, a continuous growth pattern can put investors at ease even amid extreme moves in the stock. A growth stock that course-corrects from poor decisions can also present opportunity.

As long as one exercises patience and a tolerance for stock movements, these two e-commerce conglomerates below are in a solid position to build wealth for their shareholders.

MercadoLibre

MercadoLibre (NASDAQ: MELI) is Latin America's answer to eBay and PayPal. Its e-commerce, fintech, and logistics businesses work separately and together to drive business growth and considerable returns for investors. The genius of MercadoLibre may be its ability to thrive amid adversity. Latin American countries often face political turmoil, inflation, and difficult regulatory environments that hamper business growth.

The company helps its customers with many of these issues. Merchants looking for a place to sell can turn to its online platform. Mercado Pago's financial products will also help many customers buy, even if they lack a bank account or credit card. Additionally, in markets Mercado Envios serves, the company can handle storage, order fulfillment, and shipping for business customers.

Mercado Pago and Mercado Envios also serve customers not buying on MercadoLibre. The MercadoLibre site also sells ads, and these enterprises allow the company to earn business not directly related to e-commerce.

Investors may also have a unique opportunity following its earnings for the third quarter of 2024. Its Q3 revenue of $5.3 billion rose 35% year over year. Nonetheless, the company dramatically expanded its credit portfolio. Hence, expenses rose, particularly with an 83% increase in the provision for doubtful accounts. This meant that its $397 million net income in Q3 grew by only 11%.

The news sent the stock plunging before it recovered most of the loss in subsequent trading sessions. Amid those movements, its stock surged 25% higher so far this year. It also leaves the stock with a price-to-earnings (P/E) ratio of 70, a level just above multi-year lows.

Still, when measured against the 55% rise in net income for the first three quarters of the year, MercadoLibre stock is likely worth its premium. Thus, the stock will probably continue marching higher as the company serves more customers across several verticals.

Sea Limited

Sea Limited (NYSE: SE) was a darling during the pandemic's height. Its Shopee online commerce platform led e-commerce in Southeast Asia. Its popular mobile game Free Fire bolstered its Garena gaming business, and SeaMoney met a growing need for fintech services in its home region.

Unfortunately for Sea Limited, multiple challenges weighed on the Singapore-based company during the 2022 bear market. Shopee attempted to sell goods in Europe and Latin America, where it did not have a competitive advantage. That factor forced it to close most of these markets soon after they launched.

Additionally, the Indian government banned Free Fire, meaning Garena lost access to the world's most populous country. Fortunately, Free Fire has experienced a resurgence in popularity recently, and the company will likely soon regain approval in India.

Furthermore, instead of pursuing markets where it is at a disadvantage, Shopee now invests in logistics in Southeast Asia, building the same kind of advantage that helped MercadoLibre and Amazon in their home regions.

Such moves have returned Sea Limited to double-digit revenue growth. In Q3, revenue of $4.3 billion rose 31% compared to the same quarter in 2023. Although Garena's revenue dropped 16% during that period, Shopee's 24% increase in revenue and the 38% rise in revenue from digital financial services drove its growth.

Sea Limited managed to slow its operating expense growth to just 6%. That enabled net income to rise to $153 million in Q3, well above the $144 million loss in the year-ago quarter. On that news, Sea Limited stock surged to its highest point since early 2022. Consequently, the stock is up by just over 175% this year.

Amid its recent return to profitability, investors are unlikely to balk at its 56 forward P/E ratio as the company solidifies its market position in e-commerce, fintech, and possibly soon, gaming.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Will Healy has positions in MercadoLibre and Sea Limited. The Motley Fool has positions in and recommends Amazon, MercadoLibre, PayPal, and Sea Limited. The Motley Fool recommends eBay and recommends the following options: long January 2027 $42.50 calls on PayPal and short December 2024 $70 calls on PayPal. The Motley Fool has a disclosure policy.