📊 LQDT Key Takeaways
Is Liquidity Services Inc. (LQDT) a Good Investment?
LQDT exhibits fortress-like balance sheet strength with zero debt, $195.3M cash, and healthy liquidity, but the 10795% revenue spike has not translated to proportional earnings growth (net income flat YoY), indicating severe margin compression or acquisition-related headwinds. Without understanding the driver of extraordinary revenue growth, the modest profitability metrics (7.8% operating margin, 6.8% ROE) suggest the business is not generating strong returns on its expanded capital base.
Liquidity Services is profitable with solid gross margins and a cash-rich, debt-free balance sheet, providing resilience. However, the dramatic revenue increase has not translated into stronger earnings or cash flow, with negative operating and free cash flow raising conversion concerns. Sustained improvement in operating leverage and cash generation is needed before a more constructive stance.
Liquidity Services Inc. Key Strengths (LQDT)
- Exceptional balance sheet with zero debt and $195.3M cash representing 48.7% of total assets
- Strong liquidity position with 1.51x current ratio and 1.39x quick ratio providing financial flexibility
- Healthy gross margin of 46.7% indicates pricing power and solid underlying unit economics
- Positive free cash flow of $24.6M with 10.2% FCF margin demonstrates operational cash generation capability
- Debt-free balance sheet with substantial cash
- Healthy gross margin (~47%) and positive operating income
- Adequate liquidity (current ratio 1.53x; quick ratio 1.43x)
LQDT Stock Risks: Liquidity Services Inc. Investment Risks
- Net income growth of 0% YoY despite 10795% revenue increase signals severe profitability headwinds on new revenue or unabsorbed acquisition costs
- Operating margin of only 7.8% is thin with limited downside protection; modest ROE (6.8%) and ROA (3.7%) indicate weak capital efficiency
- Unexplained revenue explosion creates uncertainty around sustainability, business quality, and whether growth is organic or acquisition-driven
- Negative operating cash flow and FCF despite profitability
- Low ROE/ROA indicating limited capital efficiency
- Revenue volatility with weak flow-through to net income
Key Metrics to Watch
- Operating margin trend and quarterly segment profitability to assess margin recovery and business unit performance
- Operating cash flow sustainability and working capital dynamics to verify cash generation quality underlying revenue growth
- Return on equity trajectory and organic versus acquired revenue breakdown to clarify business quality and capital deployment effectiveness
- Operating cash flow and FCF conversion (OCF/Net income)
- Operating margin trend and working capital intensity
Liquidity Services Inc. (LQDT) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Liquidity Services Inc. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
LQDT Profit Margin, ROE & Profitability Analysis
LQDT vs Services Sector: How Liquidity Services Inc. Compares
How Liquidity Services Inc. compares to Services sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Liquidity Services Inc. Stock Overvalued? LQDT Valuation Analysis 2026
Based on fundamental analysis, Liquidity Services Inc. has mixed fundamental signals relative to the Services sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Liquidity Services Inc. Balance Sheet: LQDT Debt, Cash & Liquidity
LQDT Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Liquidity Services Inc.'s revenue has grown significantly by 85% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.65 reflects profitable operations.
LQDT Revenue Growth, EPS Growth & YoY Performance
LQDT Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $116.4M | $5.8M | $0.22 |
| Q1 2026 | $121.2M | $5.8M | $0.18 |
| Q3 2025 | $93.6M | $1.9M | $0.19 |
| Q2 2025 | $91.5M | $1.9M | $0.18 |
| Q1 2025 | $71.3M | $1.9M | $0.06 |
| Q3 2024 | $80.8M | $1.9M | $0.19 |
| Q2 2024 | $81.5M | $1.9M | $0.13 |
| Q1 2024 | $71.3M | $1.9M | $0.06 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Liquidity Services Inc. Dividends, Buybacks & Capital Allocation
LQDT SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Liquidity Services Inc. (CIK: 0001235468)
📋 Recent SEC Filings
❓ Frequently Asked Questions about LQDT
What is the AI rating for LQDT?
Liquidity Services Inc. (LQDT) has a Combined AI Grade of B from Claude (B) and ChatGPT (B) with 64% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are LQDT's key strengths?
Claude: Exceptional balance sheet with zero debt and $195.3M cash representing 48.7% of total assets. Strong liquidity position with 1.51x current ratio and 1.39x quick ratio providing financial flexibility. ChatGPT: Debt-free balance sheet with substantial cash. Healthy gross margin (~47%) and positive operating income.
What are the risks of investing in LQDT?
Claude: Net income growth of 0% YoY despite 10795% revenue increase signals severe profitability headwinds on new revenue or unabsorbed acquisition costs. Operating margin of only 7.8% is thin with limited downside protection; modest ROE (6.8%) and ROA (3.7%) indicate weak capital efficiency. ChatGPT: Negative operating cash flow and FCF despite profitability. Low ROE/ROA indicating limited capital efficiency.
What is LQDT's revenue and growth?
Liquidity Services Inc. reported revenue of $242.0M.
Does LQDT pay dividends?
Liquidity Services Inc. does not currently pay dividends.
Where can I find LQDT SEC filings?
Official SEC filings for Liquidity Services Inc. (CIK: 0001235468) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is LQDT's EPS?
Liquidity Services Inc. has a diluted EPS of $0.46.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is LQDT's fundamental grade?
Based on our AI fundamental analysis in May 2026, Liquidity Services Inc. has a B grade with 64% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is LQDT stock overvalued or undervalued?
Valuation metrics for LQDT: ROE of 6.8% (sector avg: 16%), net margin of 6.2% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
What is LQDT's AI grade for 2026?
Our dual AI analysis gives Liquidity Services Inc. a combined B grade for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is LQDT's free cash flow?
Liquidity Services Inc.'s operating cash flow is $29.0M, with capital expenditures of $4.4M. FCF margin is 10.2%.
How does LQDT compare to other Services stocks?
Vs Services sector averages: Net margin 6.2% (avg: 10%), ROE 6.8% (avg: 16%), current ratio 1.51 (avg: 1.5).