Seeking Alpha

Liquidity Services +11.8% premarket on FQ1 beat, guidance, buyback

  • In addition to beating FQ1 estimates, Liquidity Services (LQDT) expects FY14 (ends Sep. '14) EPS of $1.60-$1.76, above a $1.59 consensus. The healthy forecast comes even though Liquidity is guiding for FQ2 EPS of $0.33-$0.37, below a $0.46 consensus.
  • Also: Liquidity has announced a $50M buyback, good for repurchasing 6.5% of shares at current levels.
  • Registered buyers +10% Y/Y in FQ1 to 2.47M, auction participants +7% to 603K, completed transactions flat at 129K.
  • Liquidity, whose shares closed yesterday near their 52-week low of $20.24, is still offering cautious macro commentary, and says its retail business has been hurt by changes in consumer spending habits.
  • The company also states the property mix for its recently-renewed DoD surplus contract "has shifted to a higher volume of lower value, smaller size items," and that this has led to higher support costs. On the other hand, its new DoD scrap contract has an incentive feature that can boost Liquidity's profit-sharing distribution to 25% from 23%.
  • FQ1 results, PR
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