Yahoo Finance Analysts Have Been Trimming Their Liquidity Services, Inc. (NASDAQ:LQDT) Price Target After Its Latest Report
Shareholders might have noticed that Liquidity Services, Inc. (NASDAQ:LQDT) filed its second-quarter result this time last week. The early response was not positive, with shares down 4.0% to US$4.79 in the past week. The result was fairly weak overall, with revenues of US$53m being 7.8% less than what the analysts had been modelling. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for Liquidity Services
Taking into account the latest results, the current consensus, from the two analysts covering Liquidity Services, is for revenues of US$201.2m in 2020, which would reflect a discernible 7.7% reduction in Liquidity Services' sales over the past 12 months. Prior to the latest earnings, the analysts were forecasting revenues of US$210.7m in 2020, and did not provide an earnings per share estimate. It looks like the analysts have become a bit less bullish on Liquidity Services, given the revenue estimates after the latest results.
The average price target fell 11% to US$8.00, withthe analysts clearly having become less optimistic about Liquidity Services'prospects following its latest earnings.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would also point out that the forecast 7.7% revenue decline is better than the historical trend, which saw revenues shrink -15% annually over the past five years
The Bottom Line
The clear low-light was that the analysts cut their forecast revenue estimates for Liquidity Services next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Liquidity Services' future valuation.
At least one of Liquidity Services' two analysts has provided estimates out to 2021, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for Liquidity Services you should know about.
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