Whitney Tilson warned us about Lumber Liquidators months ago in this troubling presentation
The report found that the company - North America's largest speciality retailer of hardwood flooring - appears to be selling Chinese-made laminate flooring with levels of formaldehyde that exceeds what's allowed under California law.
In an email, Tilson wrote that after the "60 Minutes" investigation, he's even more certain that the stock is a "zero."
"In 16 years of professional money management, I've seen hundreds of companies do all sorts of bad things to get their stock prices up," Tilson told Cooper. "But this has got to be the worst."
Tilson first decided to short Lumber Liquidators stock back in 2013 when he saw the company's profit margins explode, largely due to what appeared to be cheaper cost of goods.
"When you see a commodity business suddenly double its profit margins, that raises red flags," Tilson said. "It's almost unprecedented for a company."
About six months later, Tilson was tipped off that the company was likely purchasing formaldehyde-tainted laminated flooring in China.
Tilson laid it all out months ago in the following presentations, which he was kind enough to share with Business Insider.