Heritage Global (NASDAQ:HGBL) Releases Quarterly Earnings Results, Misses Estimates By $0.50 EPS

Heritage Global (NASDAQ:HGBL) issued its earnings results on Thursday, August 13th. The company reported ($0.46) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.04 by ($0.50), FiscalAI reports. Heritage Global had a positive return on equity of 6.12% and a negative net margin of 29.63%.The firm had revenue of $12.27 million during the quarter, compared to the consensus estimate of $13.29 million.

Here are the key takeaways from Heritage Global’s conference call:

• The company substantially wound down Heritage Global Capital, recording approximately $21.7 million in non-cash charges tied to non-performing loans. Consolidated operating loss was $20.9 million and net loss was $15.9 million, compared with net income of $1.6 million a year earlier.
• Management said exiting the capital business should reduce management distraction and allow capital and attention to shift toward the profitable industrial and financial-assets operations, which it views as stronger platforms for long-term growth.
• The DebtX, NLEX and newly acquired Boston Note businesses are being positioned as an asset-light brokerage platform covering performing and non-performing loans across residential and commercial markets. Management cited eight trial transactions generating more than $500,000 in revenue and sees significant expansion potential in seller-financed notes.
• Heritage Global reported a growing industrial-auction pipeline, including larger and more diverse opportunities in manufacturing, food and beverage, pharmaceuticals, EVs, cannabis, construction and transportation. The company is adding select sales personnel and believes activity should strengthen in the second half of the year.
• Quarterly revenue declined to $12.3 million from $14.3 million, while adjusted EBITDA fell to $1.2 million from $2.8 million. The company ended June with $13.2 million of cash, or $6.5 million in net available cash after client-related obligations, and $9.4 million of net working capital.

Heritage Global Trading Down 2.2%

NASDAQ HGBL traded down $0.03 during trading on Tuesday, hitting $1.32. The stock had a trading volume of 47,404 shares, compared to its average volume of 195,748. The company has a quick ratio of 1.29, a current ratio of 1.69 and a debt-to-equity ratio of 0.08. The company has a market capitalization of $45.72 million, a PE ratio of -3.22 and a beta of 0.46. The firm has a 50 day moving average price of $1.22 and a 200 day moving average price of $1.26. Heritage Global has a twelve month low of $1.01 and a twelve month high of $1.79.

Analyst Ratings Changes

A number of equities research analysts recently weighed in on the stock. Weiss Ratings upgraded shares of Heritage Global from a “sell (d-)” rating to a “sell (d)” rating in a report on Tuesday, September 8th. Lake Street Capital reduced their price target on shares of Heritage Global from $4.50 to $3.00 and set a “buy” rating for the company in a research report on Friday, August 14th. One investment analyst has rated the stock with a Buy rating and one has assigned a Sell rating to the company. According to MarketBeat, the company currently has a consensus rating of “Hold” and an average target price of $3.00.

Heritage Global Company Profile

Heritage Global, Inc (NASDAQ:HGBL) is an asset services company that helps businesses, lenders, governments and other organizations monetize surplus, specialized and distressed assets. Through its operating subsidiaries, the company provides auction, liquidation, brokerage, valuation and advisory services for industrial, commercial and financial assets.

Heritage Global’s services include live and online auctions, negotiated sales, asset appraisals, valuations, inventory management and other capital-recovery solutions.