NEW YORK (TheStreet) -- Shares of Liquidity Services Inc. (LQDT) are falling -10.83% to $13.09 after cutting its third quarter earnings guidance to 10%-20% below its previous forecast of 28 cents to 34 cents per diluted share. The consensus estimate was for an EPS of 30 cents.
The auction marketplace for surplus and salvage assets is expecting adjusted EBITDA to be 10% to 20% lower than its original $18 million to $21 million estimates.
Additionally, the company announced its sale of selected rolling stock and other assets under its surplus contract with the U.S. Defense Logistics Agency were halted at the request of the DLA.
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The agency wants to further review of the impact of regulatory rules on the DLA rolling stock property stream before moving on with its purchase.
Liquidity Services said it's expecting its guidance cut and sales halt to "adversely impact" its third quarter and full year financial results.
Separately, TheStreet Ratings team rates LIQUIDITY SERVICES INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate LIQUIDITY SERVICES INC (LQDT) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."