Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of online auctioneer Liquidity Services (NASDAQ:LQDT) plummeted 25% today after its quarterly results and outlook disappointed Wall Street.
So what: The stock has plummeted over the past year on deteriorating fundamentals, and today's Q3 results -- EPS of $0.26 missed the consensus by $0.09 on a revenue decline of 1.5% -- coupled with downbeat guidance only reinforce that trend. In fact, Liquidity's Gross Merchandise Volume fell 12% over the year-ago period to $128.3 million, suggesting that its competitive position continues to weaken.
Now what: Management now sees full-year EPS of $1.10 to 1.27, versus the Wall Street consensus of $1.65. "Although global economic conditions have improved, our overall outlook remains cautious regarding our commercial capital assets business due to volatility in capital spending patterns," said the Company in a statement. "In addition, our retail supply chain business has seen significant changes in consumer spending habits in certain categories, such as electronics, which has been affected by increases in payroll taxes, continued high unemployment, and reduced innovation in the sector, resulting in decreased spending and decreased pricing in the secondary market, resulting in margin pressure." Of course, with Liquidity shares now off a whopping 70% from their 52-week highs and trading at a single-digit forward P/E, much of that trouble might already be baked into the price.
More compelling ways to grow
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.
Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Liquidity Services. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.