Lumber Liquidators stock soars after big earnings, sales beats; to close some stores by year-end

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Shares of Lumber Liquidators Holdings Inc. soared 11% in premarket trading Monday, after the wood-flooring seller reported third-quarter profit and sales that rose well above expectations, as “an increased willingness of customers to allow contractors into their homes” amid the pandemic for installation and home improvement projects helped boost demand. Net income rose to $15.5 million, or 53 cents a share, from $1.05 million, or 4 cents a share, in the year-ago period. Excluding non-recurring items, adjusted earnings per share grew to 67 cents from 7 cents, above the FactSet consensus of 26 cents. Sales increased 12.1% to $295.8 million, beating the FactSet consensus of $275.6 million, as same-store sales growth of 10.9% topped expectations of a 3.5% rise. The company said the reinstatement in August of tariffs on goods from China reduced cash flow, as the company started paying the tariffs. “As this product is sold beginning in the fourth quarter, the increased cost of the tariffs will flow through the income statement,” the company stated. Separately, the company said it decided to close all eight of its stores in Canada and to close six stores in the U.S. by the end of the year. The stock has more than doubled (up 126.4%) year to date through Friday, while the S&P 500 has gained 1.2%.
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