Companies and Brands
Lumber Liquidators Stops Sale of Remaining China-Made Laminate Flooring
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After a tumultuous year thus far, Lumber Liquidators Holdings Inc. (NYSE: LL) looks like it might be on the road to recovery. The company has suffered ever since the cable news show “60 Minutes” indicated that its laminate flooring contained carcinogens in March of last year. But now, Lumber Liquidators has agreed not to resume the sale of its inventory of Chinese-made laminate wood flooring, which was at the heart of this story.
For some background: the company was hit with a revelation at the beginning of 2016 that some of its wood products sourced from China contained high levels of formaldehyde. along with another charge that it was importing wood products made from Mongolian oak, a violation of the Lacey Act, which forbids importing timber products made from materials protected by another country’s laws.
Around the same time, the Centers for Disease Control and Prevention (CDC) reversed its earlier report that Lumber Liquidators’ China-sourced laminate flooring posed a low risk of cancer. The new report raised the potential risk by a factor of three.
However, now that the company agreed to not sell its remaining inventory of Chinese-laminate flooring, investors appear to be taking a more positive stance on the company, and the potential for lawsuits and unfavorable reports in the future is definitely diminished.
The U.S. Consumer Products Safety Commission (CPSC) commented that the sale or disposal of any left-over inventory of laminate flooring would be under scrutiny, and it can only be made after getting the regulator’s approval.
Over 614,000 U.S. consumers purchased these laminates between the years 2011 and 2015, according to CPSC. Consumers are encouraged to reach out to the company for its testing kit to see if they are at risk.
Shares of Lumber Liquidators were last seen trading up 16.6% at $15.46 on Friday, with a consensus analyst price target of $11.50 and a 52-week trading range of $10.01 to $22.98.
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