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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Liquidity Services, Inc. (XNAS:LQDT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
LQDT
Name:
LIQUIDITY SERVICES, INC. (XNAS:LQDT)
Sector:
- 94.00K
Industry:
Internet Retail
CEO:
Mr. William Angrick
Total Employees:
614
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -128.93% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF LIQUIDITY SERVICES, INC.(LQDT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INTERNET RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
17.07
One Month Price Target:
$17.2
Six Month Price Target :
$17.88
Likely Price in One Year's Time:
Ticker:
$18.69
Likely Trading Range Today Under (Normal Volatility)
$16.98
Price Upper limit ($) :
$17.25
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$15.48
This week:
$13.52
This month :
$9.97
Other Primary facts
Market Cap:
634.47M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
35.58M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
41.5%
-18.92%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$24.43
$20.98
$9.71
$13.16
Medium risk (<10%) entry points
Buy Call
Sell Call
$19.86
Buy Put:
Sell Put:
$19.13
$14.27
$15.01
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
LQDT
Sharpe Ratio:
5.20%
Comparison:
LQDT, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 69.73% higher than the industry
& ratio is 128.33% higher than the market/S&P 500 average
Average Returns/Yield of
LQDT
Daily returns:
0.25%
Weekly returns:
1.25%
Monthly returns:
5.02%
Yearly returns:
37.29%
Comparison of returns:
Average annual returns/yield (last 3 years) is 61.44% above industry average
Classification:
LQDT, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.5
Statistical test of Returns:
LQDT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.65%
Weekly Volatility:
10.40%
Monthly Volatility:
20.79%
Yearly Volatility:
72.03%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.17%
Volatility in last five trading days has been -74.76% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-9.30%
Weekly VaR:
-20.79%
Monthly VaR:
-41.58%
How Much Can the price of
LQDT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-34%
Worst case (decline):
>85%
This translates to price declining to:
$11.29
This translates to price declining to:
$2.56
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
LQDT is a 193.50% riskier investment compared to the market/S&P 500 & is 151.44% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -1.20% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
LQDT
Beta in relation to market/S&P 500--1.41
Expected beta in 1 year's time:
-
Expected beta in 3 year's time:
-
Unlevered (debt free) Beta:
1.236
Beta in relation to Nasdaq (XNAS):
0.435
Beta in relation to all global stocks::
0.608
Beta Comparison & Analysis
Beta of competitors/peers::
1.679
Beta is -16.03% lower than peers
Average Industry Beta:
2.105
Beta is -33.02% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
40.39%
Sustainable growth rate is -40.85% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.474
Alpha is 140.30% above industry average alpha yield
Alpha is 3017% higher than market/& is unsustainably high
Analysis of Cost of Capital of
LQDT
Equity cost of capital:
0.128
Equity cost of capital is -27.10% below industry mean WACC
Unlevered (without debt) cost of capital:
11.23%
Before-tax cost of debt:
0.28%
After-tax cost of debt:
0.22%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.22%
WACC is 15.20% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$7.73
Revenue growth rate per share of (3Y):
4.43
Annual revenue growth rate is -80.26% below industry average
EPS:
$1.63
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$1.23
-
-
Debt per share
$0.33
EBITDA per share
$1.21
Valuation Analysis Today of
LQDT
P/E Ratio:
9.05
P/E Ratio of Competitors/Peers:
29.16
P/E ratio is -68.95% lower than main peers & is -45.70% lower than the industry
Stock price/value with industry average P/E ratio: $27.18
LQDT is -37.19% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
2.21
Price to sales ratio is 7.88% above the industry mean
P/B (Price to book value ratio):
4.43
Price to free cash flow: 13.86
-
Net income growth rate (3Y):
-522.36%
Net income growth rate is -868.36% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
8.59%
Net debt to equity ratio:
-54.83%
Debt to assets ratio:
4.10%
Net debt to assets ratio:
-26.20%
Debt-to-asset ratio is -93.74% below industry average
Ability to repay debt:
Interest coverage ratio:
937.48
Interest coverage ratio is 8881.79% more than industry average
Looking forward:
Debt growth rate:
26.78%
Annual debt growth is -9% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.23%
Analysis of Key Statistics
Correlation of price movement with the market:
0.173
Statistical significance of correlation:
LQDT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.441
Stock price is -60.88% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.441
Correlation of price movement with Nasdaq (^IXIC):
-0.042
Covariance of price movement with the market:
-0.112
Kurtosis
15.987
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
1.892
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
LQDT
Gross Profit Margin Ratio:
232%
Operating Profit Margin Ratio:
12.50%
Operating profit margin is 56.84% higher than the industry
Net Profit Margin Ratio:
232%
Effective Tax Rate:
-63.33%
Effective tax rate is -799.23% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
41.40%
Return on equity (ROE) is 110.19% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
19.78%
Return on assets (ROA) is 571.18% higher than the industry
Financial Leverage:
1.0x
Current Ratio:
0.96
Current ratio is -51.61% below industry average
Cash Conversion Cycle (days):
-238.4
Cash conversion cycle is -465.14% below industry average
The remaining useful life of property plant & equipment is: 4.7 years
Stock based compensation to net income ratio:
4.02%
In-depth Efficiency Analysis
Revenue generated per employee:
447.8K
Each employee generates -41% less revenue than industry average revenue per employee
EBITDA generated per employee:
70.2K
Each employee generates -63% less EBITDA than industry average revenue per employee
Profit generated per employee:
92.4K
Each employee generates -47% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 0.2K
Each employee generates -110% less free cash flow than industry average revenue per employee
Assets/Capital per employee
271.0K
Each employee generates -110% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
LQDT
CHUY'S HOLDINGS, INC. (XNAS:CHUY)
INTERFACE, INC. (XNAS:TILE)
LINDBLAD EXPEDITIONS HOLDINGS, INC. (XNAS:LIND)
CARLOTZ, INC. (XNAS:LOTZ)
WESTPORT FUEL SYSTEMS INC. (XNAS:WPRT)
SHOE CARNIVAL, INC. (XNAS:SCVL)
SPORTSMAN'S WAREHOUSE HOLDINGS, INC. (XNAS:SPWH)
RUTH'S HOSPITALITY GROUP, INC. (XNAS:RUTH)
-
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�13%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
274.98M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
115.45M
159.53M
-
83.14M
124.07M
40.93M
8.12M
132.19M
374.00K
46.00K
8.33M
43.12M
34.37M
56.75M
34.74M
- 22003.00K
56.75M
Statement of Cash Flow
Date:
Period:
2.30M
Differed Income Tax :
881.00K
Stock Based Compensation :
2.28M
Change in Working Capital :
- 7092.00K
Accounts Receivables:
- 1795.00K
Other Working Capital:
274.00K
Other Non-Cash Items:
- 102.00K
Net Cash Provided by Operating Activities:
1.87M
Investments in PP&E:
- 1964.00K
Net Acquisitions:
- 11063.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
12/31/21
2022
Q1
91.32M
-
91.32M
7.80M
13.23M
8.14M
120.49M
33.47M
88.73M
19.19M
-
19.22M
5.79M
166.39M
-
286.88M
80.25M
4.38M
-
4.69M
35.71M
125.02M
11.77M
13.00M
24.78M
-
149.80M
36.00K
- 67660.00K
- 9142.0K
213.85M
December 31, 2021 at 12:00:00 AM
247.64M
137.08M
286.88M
-
16.16M
- 75165.0K
-
6.00K
- 13021.00K
- 27.00K
-
- 2963.00K
-
- 851.00K
- 3841.00K
- 23.00K
- 15014.00K
91.32M
106.34M
1.87M
- 1965.00K
- 94.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
LQDT
2023
2024
2025
2026
2027
$18.78
$29.83
$32.66
$35.75
$39.14