LQDT
Liquidity Services, Inc.
$34.43
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 32.0% above fair value
You pay
$34.43
Bear
$22.83
Fair
$26.09
Bull
$29.35
Bear
$22.83
-33.7%
$0.90 × 21x P/E
Fair
$26.09
-24.2%
$0.90 × 24x P/E
Bull
$29.35
-14.8%
$0.90 × 27x P/E
Key Value Driver
Normalized P/E multiple (24x base case)
Implied Market Multiple
38.2x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $44.00 from 14 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $26.09 per share.
Warnings
Wall Street's average price target is $44.00 (from 14 analysts). Our estimate is 51% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples