One-glance verdict
Within fair range
$51.29 our estimate vs market $42.49
Wall Street consensus: $51.00 (-0.6% lower than our fair-value estimate)
17% below our estimate
Fundamentals snapshot
Liquidity Services, Inc.
LQDT · NMS · Consumer Cyclical · Internet Retail
Current price
$42.49
52-week range
$21.67 - $44.09
Market cap
$1.33B
Balance sheet
Healthy
8.02x Adequate
Net cash $217.26M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 2.7% last year.
- Reward Returns 15.0% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 7/10 years.
- Risk Stock trades 53.7% above its 5-year average P/E.
What this company does
Liquidity Services, Inc.
Liquidity Services operates online marketplaces where governments and large companies sell their surplus and returned goods, like used industrial equipment or overstocked consumer electronics. The company makes money primarily by taking a commission from these sales, acting as a specialized eBay for businesses and government agencies. This matters because it helps large organizations efficiently turn unwanted assets into cash instead of letting them go to waste.
How the company got here
Liquidity Services was founded in 1999 with an online marketplace called Liquidation.com to help businesses sell surplus goods. [6, 9] A key early success was winning a contract in 2001 to sell surplus items for the U.S. Department of Defense, which helped establish the company. [6, 9, 10] After going public in 2006, it grew by acquiring other marketplace companies, including one focused on government surplus. [6] A major turning point came in the mid-2010s when it lost a large defense contract, which pushed the company to diversify and serve a wider range of clients. [2] This led to a focus on helping retailers, industrial companies, and local governments, as well as an expansion into software services with the purchase of Machinio in 2018. [2, 6]
What it actually does
Think of Liquidity Services as a collection of online auction sites, like eBay, but for businesses and government agencies. [19] The company provides websites where organizations can sell items they no longer need, such as customer returns, used equipment, or vehicles. [6, 11] It helps sellers get cash for their surplus goods and helps buyers find deals on everything from pallets of consumer electronics to used construction machinery. [2, 12] By finding new homes for these used items, the company plays a role in the 'circular economy' (an economy focused on reusing and recycling items to minimize waste). [11, 14]
GovDeals
This is the company's marketplace for government agencies—from small towns to large state departments—to sell their surplus items. [5, 7] This includes things you might expect, like used police cars, school buses, and office furniture, as well as confiscated property and real estate. [7, 11, 20] Government agencies pay to use the platform because it provides a transparent and public way to sell unneeded assets to a huge base of potential buyers. [9, 12] This segment is a large and consistently growing part of the company's business. [18]
Retail Supply Chain Group (RSCG)
This segment helps major retailers and e-commerce companies deal with the flood of products that customers return. [5, 12] Instead of throwing items away, retailers use Liquidity Services' marketplaces, like Liquidation.com, to sell pallets of these returned and overstocked goods to smaller businesses and resellers. [2, 18] The retailers pay for this service, which is often called 'reverse supply chain' management (the process of getting goods from the customer back to a point of sale). [2, 16] This is one of the company's largest business lines. [3]
Capital Assets Group (CAG)
This division focuses on selling big, expensive equipment for commercial businesses. [5, 7] Think of it as a marketplace for used machinery from industries like construction, energy, and biopharma. [7, 11] Companies use the company's AllSurplus marketplace to sell everything from idle manufacturing robots to entire sets of oil and gas equipment. [2, 7] Businesses pay for help with the entire process, including asset valuation (estimating what the equipment is worth) and marketing to a global network of specialized buyers. [7, 12]
Machinio
This segment is a bit different because it's more of a software and marketing business than a direct marketplace. [2, 5] Machinio operates a global search engine that helps buyers find used heavy equipment listed for sale across thousands of dealer websites. [5, 29] The customers are the equipment dealers, who pay Machinio a recurring subscription fee for software that helps them manage their inventory and for marketing services that generate sales leads (connections to potential buyers). [2, 25] This provides a steady revenue stream for Liquidity Services that is not dependent on individual sales commissions. [2]
What management is betting on now
The company's main focus is on expanding its 'asset-light' model, where it earns a commission for helping others sell their goods rather than buying the inventory itself. [2, 16] This approach, known as consignment, generally has better margins (the profit made on each dollar of sales). [16] They are also investing heavily in technology to improve their marketplaces and provide better data to sellers on what their items are worth. [2] Another key strategy is to grow its software-based revenue through its Machinio segment, which provides a more predictable income stream. [2] Finally, management is emphasizing the company's role in sustainability and the circular economy, betting that more organizations will seek ways to reduce waste by reselling their used assets. [14, 32]
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$19.16M
FY2025 Q1
$-13.96M
FY2025 Q2
$19.78M
FY2025 Q3
$17.16M
FY2025 Q4
$35.97M
FY2026 Q1
$-2.79M
FY2026 Q2
$27.40M
FY2026 Q3
$29.41M
Revenue
$129.58M
Net income
$10.43M
Diluted EPS
0.32
Operating cash flow
$31.17M
Free cash flow
$29.41M
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Sources
Revenue
$120.73M
Net income
$7.52M
Diluted EPS
0.23
Operating cash flow
$29.54M
Free cash flow
$27.40M
Fetching…
Sources
Revenue
$121.22M
Net income
$7.49M
Diluted EPS
0.23
Operating cash flow
$-526.00K
Free cash flow
$-2.79M
Fetching…
Sources
Revenue
$118.09M
Net income
$7.82M
Diluted EPS
0.24
Operating cash flow
$37.99M
Free cash flow
$35.97M
Fetching…
Sources
Revenue
$119.88M
Net income
$7.41M
Diluted EPS
0.23
Operating cash flow
$19.26M
Free cash flow
$17.16M
Fetching…
Sources
Revenue
$116.38M
Net income
$7.05M
Diluted EPS
0.22
Operating cash flow
$21.64M
Free cash flow
$19.78M
Fetching…
Sources
Revenue
$122.33M
Net income
$5.81M
Diluted EPS
0.18
Operating cash flow
$-12.14M
Free cash flow
$-13.96M
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Sources
Revenue
$106.93M
Net income
$6.38M
Diluted EPS
0.20
Operating cash flow
$22.01M
Free cash flow
$19.16M
Fetching…
Sources
Is it cheap or expensive?
Fair value $51.29 vs current price $42.49
Wall Street consensus is the average analyst price target: $51.00 (-0.6% lower than our fair-value estimate).
Our most-likely fair value is $51.29 a share — about 20.7% away from today's price of $42.49, so the stock currently looks fairly priced.
Is it drowning in debt?
Healthy
Net cash $217.3M - more cash than debt. Interest coverage 8.0x.
Net debt
$-217.26M
Interest coverage
8.02x
Liquidity Services, Inc.'s profit covers its interest bill about 8.0 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
LQDT
BASELINE
Liquidity Services, Inc.
Total debt $13.84M Interest coverage 8.02x This is the baseline the peer rows are being compared against.
Total debt $249.70M Interest coverage -6.57x -100% vs LQDT This peer has almost no interest-payment cushion compared with LQDT.
Total debt $4.70B Interest coverage 3.86x -52% vs LQDT Carries about 2.1x less debt cushion than LQDT.
Total debt $2.47B Interest coverage 11.25x +40% vs LQDT Carries about 1.4x more debt cushion than LQDT.
Total debt $88.37M Interest coverage 101.67x +1,169% vs LQDT Carries about 12.7x more debt cushion than LQDT.
What you should know
The case for and against LQDT
3 Rewards
1 Risk
Rewards
-
Revenue grew 2.7% last year.
-
Returns 15.0% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 7/10 years.
Risks
-
Stock trades 53.7% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
41.66x
Forward P/E
23.09x
P/B
5.64x
P/S
2.72x
EV/EBITDA
22.43x
PEG ratio
1.02x
Profitability
How much profit each dollar creates
Gross margin
47.6%
Operating margin
10.8%
Net margin
6.8%
ROE
15.0%
ROA
6.9%
Health
Liquidity and balance-sheet strength
Debt / equity
0.06x
Current ratio
1.58x
Quick ratio
1.43x
Total debt
$13.84M
Total cash
$231.10M
Growth
How the business has been compounding
Revenue TTM
$489.62M
Revenue 5Y CAGR
16.6%
EPS TTM
1.02
EPS 5Y CAGR
-10.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$98.18M
Free CF TTM
$58.96M
FCF margin
12.0%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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