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Shares of Liquidity Services (NASDAQ:LQDT) have lost more than 9% of their value this afternoon after the surplus-goods broker missed fiscal fourth-quarter earnings-per-share expectations and guided its first-quarter EPS range below expectations as well.
Why it's happening
Liquidity's fiscal fourth quarter saw $118.4 million in revenue and $0.13 in adjusted earnings per share. The top line handily bested Wall Street's expectation for $105.1 million in revenue despite declining 8% year over year, However, Liquidity's EPS missed Wall Street's target for $0.15 per share, and was down by 67% from the year-ago quarter.
The company is now citing difficulties in forecasting sales and margins due to its new contract, and as such will be offering less guidance than previously -- only gross merchandise volume, adjusted EBITDA, and adjusted EPS will be offered, and only on a quarter-by-quarter basis. As adjusted EPS is the only metric that's commonly estimated by analysts, we'll focus on it here -- Liquidity now expects to earn between $0.16 and $0.22 per share for its fiscal first quarter, which is significantly lower than Wall Street's $0.25 EPS consensus.
Alex Planes 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.
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