UPDATE: Bank of America Initiates Coverage on Liquidity Services with Buy Rating, $55 PT

In a report published Friday, Bank of America Merrill Lynch initiated coverage on Liquidity Services LQDT with a Buy rating and a $55.00 price target. BofA Merrill Lynch noted, “There are many qualities we like about Liquidity Services such as: having a strong network effect, disrupting a large fragmented market, excellent management and the ability to scale. Key risks include: high seller concentration (DoD is 50%+ of rev), increasing competition, economic downturns neg. impacting business, lack of mobile offerings and limited but growing int'l presence. Liquidity Services has been profitable and cash flow positive every year since 2003. Liquidity Services touts a growing seller/buyer base including 50+ Fortune 500 corporations, 4,500+ federal, state and local government agencies and over 1.7mn registered buyers.” Liquidity Services closed on Thursday at $41.16.