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1. Company Snapshot

1.a. Company Description

Liquidity Services, Inc.provides e-commerce marketplaces, self-directed auction listing tools, and value-added services.It operates through four segments: Retail Supply Chain Group, Capital Assets Group, GovDeals, and Machinio.


The company's marketplaces include liquidation.com that enable corporations to sell surplus and salvage consumer goods and retail capital assets; GovDeals marketplace, which provides self-directed service solutions in which sellers list their own assets that enables local and state government entities, and commercial businesses located in the United States and Canada to sell surplus and salvage assets; and AllSurplus, a centralized marketplace that connects global buyer base with assets from across the network of marketplaces in a single destination.It also provides marketplace for corporations located in the North America, Europe, Australia, Asia, and Africa to sell manufacturing surplus, salvage capital assets, and scrap material, as well as offers a suite of services, including surplus management, asset valuation, asset sales, marketing, returns management, asset recovery, and ecommerce services.In addition, the company operates a global search engine platform for listing used equipment for sale in the construction, machine tool, transportation, printing, and agriculture sectors.


It offers products from industry verticals, such as consumer electronics, general merchandise, apparel, scientific equipment, aerospace parts and equipment, technology hardware, real estate, energy equipment, industrial capital assets, heavy equipment, fleet and transportation equipment, and specialty equipment.Liquidity Services, Inc.was incorporated in 1999 and is headquartered in Bethesda, Maryland.

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1.b. Last Insights on LQDT

Liquidity Services' recent performance faces challenges from expanding competition and evolving market conditions. The company's announcement of its fourth-quarter fiscal year 2025 earnings conference call on October 20, 2025, may indicate pressure on its financials. Additionally, Machinio's expansion to support service providers on October 22, 2025, could intensify competition. Furthermore, the company's focus on online marketplaces, such as GovDeals, which expanded to Southern California on October 28, 2025, may not be yielding desired results.

1.c. Company Highlights

2. Liquidity Services' Q1 FY2026 Results Exceed Expectations

Liquidity Services, Inc. reported strong first quarter fiscal year 2026 results, with consolidated gross merchandise volume (GMV) of $398 million, up 3% year over year, and direct profit of $57 million. Non-GAAP adjusted EBITDA grew 38% year over year to $18.1 million. The company's adjusted EPS came in at $0.39 per share, beating estimates of $0.31 per share. The company closed the quarter with $181.4 million in cash and no financial debt, highlighting its solid financial position.

Publication Date: Feb -08

📋 Highlights
  • Strong Q1 FY2026 Performance:: Consolidated GMV reached $398M (+3%), direct profit rose to $57M, and adjusted EBITDA surged 38% to $18.1M, with adjusted EPS at $0.39 (+39%).
  • Segment Growth Drivers:: GovDeals GMV grew 7% via seller acquisition, CAG heavy equipment GMV jumped 27% YoY, and Retail segment profit increased 16% despite 3% GMV growth.
  • Technology-Driven Efficiency:: Automation and AI tools (e.g., asset scanning, intelligent signaling) improved buyer conversion, while data-driven pricing and sell-in-place solutions boosted heavy equipment GMV by 20%.
  • Q2 Guidance:: GMV projected at $375–415M, adjusted EBITDA $14–17M (+double-digit YoY), and adjusted EPS $0.29–0.38, driven by automation and sales resource expansion in high-growth categories.
  • Heavy Equipment Scalability:: Segment on track to become $1B GMV business (current $100–110M run rate), with 30% CAGR, fueled by low-cost sell-in-place solutions and wins with NY HUD, PA DOT, and NY Port Authority.

Segment Performance

The GovDeals platform delivered 7% GMV growth, driven by seller acquisition and market share expansion. The Capital Assets Group (CAG) segment saw significant growth in the heavy equipment category, with 27% year-over-year organic GMV growth. The Retail segment achieved 3% GMV growth and a 16% increase in segment direct profit. These results demonstrate the company's ability to drive growth across its various business segments.

Operational Efficiencies

Liquidity Services is leveraging technology to drive efficiencies, including machine-driven systems and intelligent signaling to boost buyer conversion rates, and automation of asset scanning and online availability. The company is also focusing on improving automation and scoring of the right companies, delivering messages at the right times to increase conversion. This focus on operational efficiency is expected to drive future growth.

Outlook and Valuation

The company expects double-digit adjusted EBITDA growth in the second quarter, with GMV expected to range from $375 million to $415 million. Non-GAAP adjusted diluted earnings per share is estimated to be $0.29 to $0.38 per share. With a P/E Ratio of 33.45 and an EV/EBITDA ratio of 17.57, the market is pricing in significant growth expectations. Analysts estimate next year's revenue growth at 9.4%, which is in line with the company's historical performance. The company's strong financial position, operational efficiencies, and growth prospects make it an attractive investment opportunity.

Growth Initiatives

The company is making progress in its growth initiatives, including the Retail Rush product, which is live in its first prototype and showing promising results. The heavy equipment segment, which includes yellow iron, saw 20% GMV growth driven by a sell-in-place solution offering lower net commission rates and flexibility for the seller. These growth initiatives are expected to drive future growth and expand the company's market share.

3. NewsRoom

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Monroe County, FL Continues Online Surplus Sale Transition with Second Auction on GovDeals

Feb -10

Source: globenewswire.com

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Liquidity Services, Inc. (LQDT) Q1 2026 Earnings Call Transcript

Feb -05

Source: seekingalpha.com

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Hussman Strategic Advisors Inc. Has $2.30 Million Stock Position in Liquidity Services, Inc. $LQDT

Jan -28

Source: defenseworld.net

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Liquidity Services: Waiting For One More Dip

Jan -12

Source: seekingalpha.com

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Liquidity Services Announces First Quarter Fiscal Year 2026 Earnings Conference Call

Jan -06

Source: globenewswire.com

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Assenagon Asset Management S.A. Has $7.46 Million Stock Holdings in Liquidity Services, Inc. $LQDT

Dec -22

Source: defenseworld.net

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Scioto County Career Technical Center Conducts First-Ever Online GovDeals Real Estate Sale

Dec -09

Source: globenewswire.com

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This Little-Known eBay Competitor Is Starting To Heat Up: Momentum Score Spikes

Dec -02

Source: feeds.benzinga.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.69%)

6. Segments

Retail Supply Chain Group

Expected Growth: 3.5%

The 3.5% growth of Retail Supply Chain Group from Liquidity Services, Inc. is driven by increasing adoption of e-commerce, rising demand for reverse logistics, and growing need for efficient inventory management. Additionally, the group's focus on sustainability and circular economy practices, as well as its ability to provide data-driven insights to retailers, contribute to its growth momentum.

GovDeals

Expected Growth: 3.8%

GovDeals' 3.8% growth driven by increasing adoption of e-commerce platforms in the public sector, rising demand for surplus asset disposition, and strategic partnerships with government agencies. Additionally, Liquidity Services' investment in digital marketing and technology enhancements has improved the user experience, attracting more buyers and sellers to the platform.

Capital Assets Group

Expected Growth: 4.2%

Capital Assets Group's 4.2% growth is driven by increasing demand for surplus asset management services, expansion into new markets, and strategic partnerships. Additionally, the group's focus on e-commerce and digital platforms has improved operational efficiency, leading to higher margins and revenue growth.

Machinio

Expected Growth: 4.5%

Machinio's 4.5% growth is driven by increasing adoption of e-commerce platforms, rising demand for used machinery and equipment, expansion into new markets, and strategic partnerships. Additionally, the company's focus on providing a user-friendly platform, competitive pricing, and efficient logistics contribute to its growth.

Corporate and Other, Including Eliminations Adjustments

Expected Growth: 3.2%

The 3.2% growth in Corporate and Other, Including Eliminations Adjustments from Liquidity Services, Inc. is driven by increased operational efficiency, cost savings initiatives, and strategic investments in technology. Additionally, the company's focus on diversification and expansion into new markets has contributed to the growth.

7. Detailed Products

GovDeals

A leading online auction marketplace for government surplus and seized assets

Liquidation.com

A leading online auction marketplace for surplus and salvage assets

Network International

A leading provider of reverse logistics and supply chain solutions

Go-Dove

A leading provider of surplus asset management and disposition services

IronDirect

A leading provider of used heavy equipment and trucks

Secondipity

A leading provider of refurbished and used consumer electronics

8. Liquidity Services, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Liquidity Services, Inc. is medium because while there are some substitutes available, they are not very attractive to customers due to factors such as quality and convenience.

Bargaining Power Of Customers

The bargaining power of customers for Liquidity Services, Inc. is low because the company operates in a niche market and customers have limited alternatives.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Liquidity Services, Inc. is medium because while the company relies on a few key suppliers, it also has some bargaining power due to its large scale of operations.

Threat Of New Entrants

The threat of new entrants for Liquidity Services, Inc. is low because the company has a strong brand presence and operates in a market with high barriers to entry.

Intensity Of Rivalry

The intensity of rivalry for Liquidity Services, Inc. is high because the company operates in a competitive market with several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 6.20%
Debt Cost 3.95%
Equity Weight 93.80%
Equity Cost 10.85%
WACC 10.42%
Leverage 6.61%

11. Quality Control: Liquidity Services, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 4.4/10

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Quality: 7.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

32.57$

Current Price

32.57$

Potential

-0.00%

Expected Cash-Flows