Analyzing BrightView (NYSE:BV) and Liquidity Services (NASDAQ:LQDT)

Liquidity Services (NASDAQ:LQDT) and BrightView (NYSE:BV) are both small-cap industrials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Profitability

This table compares Liquidity Services and BrightView’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liquidity Services	6.79%	17.60%	9.86%
BrightView	0.74%	5.03%	1.87%

Valuation & Earnings

This table compares Liquidity Services and BrightView”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liquidity Services	$476.67 million	2.73	$28.09 million	$1.02	40.70
BrightView	$2.67 billion	0.37	$56.00 million	($0.25)	-41.90

BrightView has higher revenue and earnings than Liquidity Services. BrightView is trading at a lower price-to-earnings ratio than Liquidity Services, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Liquidity Services has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500. Comparatively, BrightView has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500.

Institutional and Insider Ownership

71.2% of Liquidity Services shares are owned by institutional investors. Comparatively, 92.4% of BrightView shares are owned by institutional investors. 28.1% of Liquidity Services shares are owned by insiders. Comparatively, 2.8% of BrightView shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Liquidity Services and BrightView, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liquidity Services	0	0	2	1	3.33
BrightView	3	2	3	1	2.22

Liquidity Services presently has a consensus target price of $50.00, suggesting a potential upside of 20.45%. BrightView has a consensus target price of $14.10, suggesting a potential upside of 34.61%. Given BrightView’s higher probable upside, analysts clearly believe BrightView is more favorable than Liquidity Services.

Summary

Liquidity Services beats BrightView on 8 of the 14 factors compared between the two stocks.

About Liquidity Services

Liquidity Services, Inc. provides e-commerce marketplaces, self-directed auction listing tools, and value-added services in the United States and internationally. The company operates through four segments: GovDeals, Retail Supply Chain Group (RSCG), Capital Assets Group (CAG), and Machinio. Its marketplaces include liquidation.com that enable corporations to sell surplus and salvage consumer goods and retail capital assets; GovDeals marketplace, which provides self-directed service solutions in which sellers list their own assets that enables local and state government entities, and commercial businesses located in the United States and Canada to sell surplus and salvage assets; and AllSurplus, a centralized marketplace that connects global buyer base with assets from across the network of marketplaces in a single destination. The company also offers a suite of services, including surplus management, asset valuation, asset sales, marketing, returns management, asset recovery, and ecommerce services. In addition, it operates a global search engine platform for listing used equipment for sale in the construction, machine tool, transportation, printing, and agriculture sectors. The company offers products from industry verticals, such as consumer electronics, general merchandise, apparel, scientific equipment, aerospace parts and equipment, technology hardware, real estate, energy equipment, industrial capital assets, heavy equipment, fleet and transportation equipment, and specialty equipment. The company was incorporated in 1999 and is headquartered in Bethesda, Maryland.

About BrightView

BrightView Holdings, Inc., through its subsidiaries, provides commercial landscaping services in the United States. It operates through two segments, Maintenance Services and Development Services. The Maintenance Services segment delivers a suite of recurring commercial landscaping services, including mowing, gardening, mulching and snow removal, water management, irrigation maintenance, tree care, golf course maintenance, and specialty turf maintenance. Its customers' properties include corporate and commercial properties, homeowners associations, public parks, hotels and resorts, airport authorities, municipalities, hospitals and other healthcare facilities, educational institutions, restaurants and retail, and golf courses. This segment's customer base includes approximately 8,800 office parks and corporate campuses 7,100 residential communities, and 550 educational institutions. The Development Services segment offers landscape architecture and development services for new facilities and redesign projects. Its services include project design and management services, landscape architecture and installation, irrigation installation, tree moving and installation, pool and water features, sports field, and other services. BrightView Holdings, Inc. also operates as official field consultant to various league baseball. The company was founded in 1939 and is headquartered in Blue Bell, Pennsylvania.