Looks Like an Overreaction to Me
I've been going through the Liquidity Services (LQDT) report, and I can't help but feel this stock is overdone to the downside and being controlled by the 20% short interest. This quarter was actually pretty strong: On earnings per share, the company came in $0.03 ahead of the $0.37 average expectation, plus it beat handily on revenue. The full-year EPS of $1.86 per share was ahead of targets, and it puts the stock at a year-end price-to-earnings ratio of 19.24x, based on the current $35.80 share price. That gives Liquidity Services a P/E relative to growth (PEG) ratio of under 1.0, which is attractive for a company that's still growing earnings and revenue.Liquidity Services (LQDT) -- Daily Source: StockCharts.com View Chart » View in New Window »
In my opinion, the issue here is in fiscal first-quarter guidance, along with an overreaction to full-year guidance. The company guided earnings per share to a $0.38 midpoint for the first quarter, whereas expectations are calling for $0.46. Full-year guidance is for $2.14 per share vs. analyst estimates of $2.20. This tells me the guidance for the full year is in line, or expected to be slightly better than current Wall Street estimates....398 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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