Liquidity Service Inc. (LQDT): Today's Featured Internet Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Liquidity Service ( LQDT) pushed the Internet industry higher today making it today's featured internet winner. The industry as a whole closed the day up 0.9%. By the end of trading, Liquidity Service rose $1.07 (2%) to $55.08 on light volume. Throughout the day, 306,737 shares of Liquidity Service exchanged hands as compared to its average daily volume of 990,200 shares. The stock ranged in a price between $53.92-$55.33 after having opened the day at $53.94 as compared to the previous trading day's close of $54.01. Other companies within the Internet industry that increased today were: Rediff.com India ( REDF), up 19.1%, Jiayuan.com International Ltd ADR ( DATE), up 8.8%, Groupon ( GRPN), up 8%, and LiveDeal ( LIVE), up 8%.

Liquidity Services, Inc. operates various online auction marketplaces for surplus and salvage assets in the United States. Liquidity Service has a market cap of $1.67 billion and is part of the services sector. The company has a P/E ratio of 29.5, below the average retail industry P/E ratio of 38.5 and above the S&P 500 P/E ratio of 17.7. Shares are up 46.2% year to date as of the close of trading on Monday. Currently there are seven analysts that rate Liquidity Service a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Liquidity Service as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the internet industry could consider First Trust Dow Jones Internet Idx ( FDN) while those bearish on the internet industry could consider ProShares Ultra Short Technology ( REW).

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