Diamond Hill Capital Comments on Liquidity Services Inc

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Jul 25, 2014

Online auction marketplace service provider Liquidity Services, Inc. (LQDT) lost a 2015 rolling stock Department of Defense contract but was the winner of the non-rolling stock contract. However, its winning bid of 4.35% was much higher than the historical contracted rate of 1.8%. This will considerably raise the cost of goods sold of its non-rolling stock segment, thus having a material impact on its profitability.

From Diamond Hill Capital (Trades, Portfolio)'s Small Cap Fund Second Quarter 2014 Commentary.