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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.