Dive Brief:

• Lumber Liquidators’ recovery Thursday was short-lived as gains it saw after CEO Robert Lynch defended the retailer’s laminate as safe were swept away again on Friday.

• Friday’s fall was precipitated in part by remarks by Goldman Sachs analyst Matthew Fassler who said the retailer is facing more issues than just the latest toxicity problem, and that it hadn’t adequately explained the testing results by 60 Minutes.

• Meanwhile, 60 Minutes has also defended its report and the testing it had conducted to bring its conclusions. 

Dive Insight:

As of Friday, Lumber Liquidators’ sales had dropped some 7.5%, and, while the conference call it held Thursday to defend its products boosted shares, that’s turned out to be temporary. The company didn’t take calls then, and the retailer’s founder has since also come out swinging, criticizing the tests used by 60 Minutes and the state of California.

But 60 Minutes is sticking by its report, and hedge fund investor Whitney Tilson, who had initially tipped off the news program, slammed the retailer’s defenses Sunday. 

In order to dig itself out, the retailer will likely have to do more than criticize the testing that’s being done. While Thursday the retailer said it would have the Chinese laminate in question independently assessed, it undermined the value of that by defending the quality and safety without those tests even getting underway. The other problem it faces is that its famously rock-bottom prices may not be possible without tapping these particular Chinese sources.