📊 LQDT Key Takeaways
Is LQDT a Good Investment? Thesis Analysis
While Liquidity Services maintains a fortress balance sheet with no debt and $169.8M in cash, the company exhibits critical operational weaknesses: a catastrophic disconnect between explosive revenue growth (+10,795% YoY) and flat net income growth (0% YoY) indicates poor quality earnings, and persistent negative operating cash flow (-$526K) despite positive net income signals the company cannot convert accounting profits into actual cash. The combination of negative FCF, historically poor capital returns (ROE 3.5%, ROA 2.0%), and deteriorating cash conversion is unsustainable.
Why Buy LQDT? Key Strengths
- Strong balance sheet with $169.8M cash and zero long-term debt providing financial flexibility
- Adequate liquidity ratios (current 1.53x, quick 1.43x) supporting near-term operational needs
- Healthy gross margin of 47% demonstrates underlying business-level profitability potential
LQDT Investment Risks to Consider
- Negative operating cash flow (-$526K) and negative free cash flow (-$2.8M) indicate company is burning cash despite accounting profitability, unsustainable long-term
- Extreme revenue growth (+10,795% YoY) paired with zero earnings growth (0% YoY) suggests low-margin revenue, one-time transactions, or acquisition integration masking operational challenges
- Severely depressed returns on capital (ROE 3.5%, ROA 2.0%) demonstrate poor capital efficiency and value destruction for shareholders
Key Metrics to Watch
- Operating cash flow trend - must turn positive to validate fundamental business viability
- Revenue quality and margins of new revenue streams contributing to growth spike
- Return on equity improvement trajectory - current 3.5% is critically low
LQDT Financial Metrics
💡 AI Analyst Insight
LIQUIDITY SERVICES INC presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
LQDT Profitability Ratios
LQDT vs Default Sector
How LIQUIDITY SERVICES INC compares to Default sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is LQDT Overvalued or Undervalued?
Based on fundamental analysis, LIQUIDITY SERVICES INC has mixed fundamental signals relative to the Default 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.
LQDT Balance Sheet & Liquidity
LQDT 5-Year Financial Trend & Growth Analysis
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 Growth Metrics (YoY)
LQDT Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| 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 |
| Q3 2023 | $69.9M | $3.6M | $0.21 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
LQDT Capital Allocation
LQDT SEC 10-K & 10-Q Filing 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 an AI rating of SELL with 70% confidence, based on fundamental analysis of SEC EDGAR filings.
What are LQDT's key strengths?
Claude: Strong balance sheet with $169.8M cash and zero long-term debt providing financial flexibility. Adequate liquidity ratios (current 1.53x, quick 1.43x) supporting near-term operational needs.
What are the risks of investing in LQDT?
Claude: Negative operating cash flow (-$526K) and negative free cash flow (-$2.8M) indicate company is burning cash despite accounting profitability, unsustainable long-term. Extreme revenue growth (+10,795% YoY) paired with zero earnings growth (0% YoY) suggests low-margin revenue, one-time transactions, or acquisition integration masking operational challenges.
What is LQDT's revenue and growth?
LIQUIDITY SERVICES INC reported revenue of $121.2M.
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 $0.23.
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 rating reflects both perspectives for balanced insights.
Is LQDT a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, LIQUIDITY SERVICES INC has a SELL rating with 70% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is LQDT stock overvalued or undervalued?
Valuation metrics for LQDT: ROE of 3.5% (sector avg: 15%), net margin of 6.2% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy LQDT stock in 2026?
Our dual AI analysis gives LIQUIDITY SERVICES INC a combined SELL rating 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 $-526.0K, with capital expenditures of $2.3M. FCF margin is -2.3%.
How does LQDT compare to other Default stocks?
Vs Default sector averages: Net margin 6.2% (avg: 12%), ROE 3.5% (avg: 15%), current ratio 1.53 (avg: 1.8).