Exclusive: Whitney Tilson Says Lumber Liquidators Stock 'Is A Zero'

Speaking to Benzinga, Whitney Tilson commented that Sunday's 60 Minutes piece featuring Lumber Liquidators Holdings LL was "UNBELIEVABLE!" "I am in awe of the investigative journalism 60 Minutes did, which validated my decision to bring the story to them," Tilson told Benzinga via e-mail. "They uncovered many things I didn't know and I am now even more convinced that this stock is a zero." Tilson clarified his stake in Lumber Liquidators and noted that "this is a three percent short position." Furthermore, "if I'm right that the stock is a zero, I make three percentage points of return." The investment manager added that any gains (or losses) attributed to his short position "is not going to make or break me" and "certainly not cause me to make false accusations against a good company." On the other hand, Tilson argued that Lumber Liquidators' senior executives have "massive incentives" to boost the price of its stock. Tilson noted that after shares "skyrocketed" from approximately $13 to as high as around $119, the company's founder and Chairman Tom Sullivan and its CEO Robert Lynch "dumped a ton of stock and pocketed a small fortune." Tilson further stated in May and July of 2013, Lynch sold 154,500 shares at an average price of $68.61, for a total of $10.6 million (versus a total cash comp in 2012 of $1.2 million). Tilson wrote that it appears that Lynch sold "every share he could" at that time, as his remaining holdings hadn't vested yet. "So, in summary, I stand to make for my investors less than $3 million if I'm right and the stock goes to zero, whereas just the top two guys at Lumber Liquidators have already cashed out to the tune of $37.3 million!," Tilson also wrote in his e-mail.