The 10-second takeaway
For the quarter ended Sep. 30 (Q4), Liquidity Services beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share grew significantly.
Gross margins contracted, operating margins contracted, net margins grew.
Liquidity Services logged revenue of $122.3 million. The 10 analysts polled by S&P Capital IQ wanted to see sales of $114.6 million on the same basis. GAAP reported sales were 54% higher than the prior-year quarter's $79.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.40. The 10 earnings estimates compiled by S&P Capital IQ anticipated $0.37 per share. GAAP EPS of $0.17 for Q4 were 70% higher than the prior-year quarter's $0.10 per share. (The prior-year quarter included -$0.12 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 42.2%, 900 basis points worse than the prior-year quarter. Operating margin was 13.1%, 130 basis points worse than the prior-year quarter. Net margin was 4.5%, 60 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $132.1 million. On the bottom line, the average EPS estimate is $0.39.
Next year's average estimate for revenue is $591.4 million. The average EPS estimate is $2.17.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 370 members out of 394 rating the stock outperform, and 24 members rating it underperform. Among 111 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 107 give Liquidity Services a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Liquidity Services is buy, with an average price target of $65.55.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend 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.