Daktronics Inc Liquidation Value

Daktronics (DAKT) presents a positive but modest liquidation recovery posture as of January 31, 2026. The company's MFFAIS-computed operating liquidation value of $160.9M reflects meaningful tangible asset coverage when the business is treated as a going concern, but the cash liquidation value of negative $57.0M confirms that a true wind-down scenario produces negative equity recovery after applying standard haircuts and holding liabilities at face value. The liquid liquidation value of $57.3M sits between these extremes.

Applying the liquidation lens to reported balances: cash and equivalents of $144.4M recover at par; accounts receivable of $114.3M at 90-95% yields approximately $103-108M; inventory of $103.6M at 60% yields approximately $62M; PP&E net of $64.2M at 50-70% yields approximately $32-45M; intangibles (goodwill $3.7M, finite-lived intangibles $3.4M) recover at zero. Gross haircutted assets are therefore roughly $341-359M before noncurrent items.

On the liability side, current liabilities of $191.6M include accounts payable $63.6M, accrued liabilities $45.8M, deferred revenue (contract liabilities current) $65.8M, and current debt $1.2M. Noncurrent liabilities of $61.1M include long-term debt $9.9M, long-term warranty obligations $24.9M, long-term contract liabilities $20.0M, deferred tax liabilities $0.1M, and other noncurrent liabilities $6.2M. Total face-value liabilities aggregate to approximately $252.6M. The warranty obligation stack ($37.4M total, split $12.5M current/$24.9M noncurrent) does not extinguish on liquidation and constitutes a material claim against haircutted assets.

From Q2 FY2026 (November 1, 2025) to Q3 FY2026 (January 31, 2026): cash declined modestly from $149.6M to $144.4M; AR increased materially versus the April 26, 2025 year-end (up $21.6M per MD&A); accounts payable increased $16.9M from year-end. The Delayed Draw Loan of $11.5M outstanding at November 1, 2025 was fully repaid upon entry into the new $71.5M JPMorgan credit facility (November 26, 2025), replacing it with a clean revolver plus undrawn term loan. No advances on the new term loan as of January 31, 2026. Share repurchases of $22.8M in the nine-month period reduced the equity cushion available to absorb haircuts. The acquisition of goodwill ($450K) in the period adds zero liquidation value. Contract liabilities (deferred revenue) of $85.8M total are a face-value liability in liquidation - these customer deposits/advance billings do not automatically convert to cash available for creditors and require completion or refund. Tariff exposure mentioned in Transportation and High School segments is discussed in MD&A but not separately tagged or quantified in XBRL, making it difficult to assess inventory write-down risk from that vector.