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News Breaks
April 3, 2014
11:04 EDTLQDTLiquidity Services continues slide, confirms withdrawal from DoD auction
Shares of surplus and salvage asset marketplace operator Liquidity Services (LQDT) are sliding again after the company confirmed it's withdrawal from auction bidding for a U.S. Department of Defense contract and said it will need to reset its adjusted earnings expectations. WHAT'S NEW: Liquidity Services announced that it will reset its outlook for earnings before interest, taxes, depreciation, and amortization, or EBITDA, for fiscal year 2015 after withdrawing from the bidding process for one defense contract and due to higher costs for another. Liquidity said that it remains the high bidder for a contract to purchase, manage and sell non-rolling stock surplus assets for the DoD with a bid equal to 4.35% of the department's original acquisition value, which is up from 1.8% previously. The company also confirmed it withdrew from an auction for a rolling stock contract due to the fact that bidding reached a level that it determined would be "economically unsustainable." The company said that if it agreed to the contract, the result would be significantly higher costs of goods sold in FY15 and beyond. Liquidity Services said it will continue to operate its current DoD surplus contract to sell all usable surplus assets including rolling stock and non-rolling stock assets for a base term ending in December, with two additional one-month renewal options. Accordingly, the company expects the bid results from the last two days to not affect its results for fiscal year 2014. ANALYST OPINION: Following today's news, Liquidity Services was downgraded to Neutral from Outperform at RW Baird, which cited the "unfavorable" auction results. The firm lowered its price target for shares to $19 from $30. Baird analyst Colin Sebastian said the firm is lowering its FY15 EBITDA estimate by $40M and sees few near-term positive catalysts outside of potential short covering on the stock. WHAT'S NOTABLE: Yesterday, Liquidity Services shares were down after the company announced that it was the highest bidder for the DoD non-rolling stock surplus contract. Baird stated in a separate note yesterday that Liquidity's high bid for the non-rolling liquidation contract was "quite a bit" higher than the firm had anticipated. The firm said then that its Outperform rating was under review pending the full contract results. PRICE ACTION: During morning trading, shares of Liquidity Services fell $2.85, or 13.66%, to $18.01. The stock had declined about 6.7% yesterday and over the last month shares have lost over 18.5%.
News For LQDT From The Last 14 Days
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February 4, 2016
07:14 EDTLQDTLiquidity Services remains cautious for FY16 outlook
Cites the changing mix and volume of supply in our DoD and commercial business, in part due to lower commodity prices and macro weakness in the energy sector. The company adds, "While we anticipate a benefit to earnings in FY16 compared to FY15 from the sale of the Jacobs Trading business, client engagements and the mix of property received under select retail client programs are unpredictable, resulting in lower supply and lower per unit prices in certain categories. In the longer term, we expect our business to benefit from: innovative new service capabilities and more efficient business operations from our LiquidityOne investment program; improved monetization of our buyer base through the deployment of our new integrated marketplace system and data warehouse; increased outsourcing of reverse supply chain activities in response to our new model and the rise of e-commerce and sustainability programs; and (iv) increased brand recognition as a market leader due to our proven track record, innovative scalable solutions and the ability to make a strategic impact in the reverse supply chain."
07:14 EDTLQDTLiquidity Services says difficult to forecast sales as DoD business seen changes
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06:59 EDTLQDTLiquidity Services reports Q1-end registered buyers 2.88M
Reports Q1-end auction participants 561K. Reports Q1 completed transactions 133K.
06:58 EDTLQDTLiquidity Services sees Q2 adjusted EPS (11c)-0c, consensus 3c
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06:57 EDTLQDTLiquidity Services: Q1 dampened by lower commodity prices
The company commented, "Our Q1 results were dampened by lower commodity prices which have adversely affected the pricing and volume of transactions in our DoD and capital assets marketplaces. However, we continue to expand our commercial and municipal government client base as our marketplace and integrated services are highly relevant to organizations seeking to manage total supply chain costs in the current business climate. We also continued to make progress on the design and build of our LiquidityOne platform to provide customers the next generation of cloud based marketplace, analytics and returns management solutions. We are testing our new product and service capabilities with customers and are excited by the initial feedback and the new opportunities we are uncovering to grow our business over the long term."
06:56 EDTLQDTLiquidity Services reports Q1 EPS (17c), consensus (5c)
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