We believe Lumber Liquidators shares will be pressured today following an updated report from the Centers for Disease Control and Prevention (CDC) and a “60 Minutes” update on Sunday on the risk of cancer due to exposure to formaldehyde in Lumber Liquidators laminate floors sourced from China.
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According to the CDC, the company was found to have used an inappropriate value for ceiling height, in the latest examination of the quantity of formaldehyde in its wood.
The incorrect number then led to an estimate – using airborne concentration elements – that was three times lower than it should have been.
It now estimates the risk of cancer at six to 30 cases per 100,000 people.
Health risks of people who have the laminate flooring are being revised to reflect greater exposure to formaldehyde, which could cause eye, nose, and throat irritation for anyone.
The news affected Lumber Liquidators’ stock, which was starting to recover after it was revealed last month that Chinese-made flooring sold at Lumber Liquidators had dangerously high formaldehyde levels.
The company’s shares dropped by about 14 percent one hour before the market opens.
Originally, the government said the exposure might cause eye, nose, and throat irritation for anyone with high levels of exposure. But the new report triggered press reports over the weekend that tied the increased cancer risk to Lumber Liquidators’ products.
The error occurred because the CDC neglected to convert feet to meters in some calculations in the first reports, according to 60 Minutes.
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“Since March of 2015, Lumber Liquidators has offered customers free independent air quality tests to provide objective scientific information about our products”. The Toano, Virginia-based company pleaded guilty to environmental crimes in October.
