MAXIMUS, INC. (MMS) presents a deeply negative liquidation recovery posture as of March 31, 2026. MFFAIS-computed cash liquidation value is approximately negative $2.1 billion, with liquid liquidation value at approximately negative $938 million. These figures are structurally driven by the asset composition: goodwill of $1.78 billion and net intangible assets of $497 million together represent approximately 53% of total assets of $4.24 billion, both of which receive zero recovery under liquidation haircut methodology. Net PP&E is de minimis at $27 million (6-7% of assets), and capitalized software ($203 million) would recover at best 50 cents on the dollar given its embedded dependency on active government contracts. The primary tangible recoverable asset is accounts receivable at $1.11 billion (gross $1.12 billion, net of $8.8 million allowance), which at a 90-95% recovery rate yields approximately $1.0-1.06 billion. Cash of $157 million recovers at par. Total liability stack at face value is $2.54 billion, anchored by $1.55 billion in funded debt principal under the JPMorgan Credit Agreement maturing through May 2031, plus $681 million current liabilities and material operating lease obligations ($92 million combined current and non-current). The deferred tax liability of $213 million adds further face-value drag in liquidation. Compared to the prior 10-Q (period ending December 31, 2025), funded debt has decreased modestly from $1.58 billion to $1.55 billion, reflecting scheduled amortization payments. The revolver balance decreased from $245 million to $225 million. DSO remained sticky at 78 days reported (102 days excluding RPA), consistent with prior quarter, reflecting ongoing payment delays on a large U.S. federal contract. A $6.9 million capitalized software impairment charge in Q2 FY2026 confirms the risk that capitalized software values are not fully realizable, particularly where contract continuity is uncertain. The balance sheet carries $380 million of intangible assets from a single 2021 acquisition tied to VA MDE contracts; MD&A flags potential impairment if contract expectations change, but no impairment has been taken as of this filing. The Consolidated Net Total Leverage Ratio per credit agreement definition is 1.75x as of March 31, 2026 (versus 1.79x at December 31, 2025), providing no immediate covenant stress, but this ratio uses adjusted EBITDA with numerous add-backs and is not informative for liquidation recovery analysis. Free cash flow for the six months ended March 31, 2026 was negative $71.6 million, and operating cash flow was negative $54.9 million, both driven primarily by working capital absorption in receivables. The filing does not separately disclose the Receivables Purchase Agreement off-balance-sheet sold receivables quantum beyond noting $682 million derecognized year-to-date under the RPA facility, which if on-balance-sheet would increase both the AR asset and corresponding liability, widening the recovery gap.
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