Today, both Merrill Lynch and Interactive Brokers have indefinitely halted margin trading on Lumber Liquidators shares. Investors who own shares on margin must either fund their accounts to eliminate the margin or sell off their positions in order to cover their current margin account balances. Going forward, at these brokers, it will no longer be possible to purchase LL shares on margin.
Greed & Power
This is simply one more example of how Wall Street has lost faith in the company. The “leadership” of Lumber Liquidators, led by CEO Dennis Knowles and by Chairwoman Nancy M. Taylor insist on remaining in power at the company, and in doing so, are harming all shareholders and employees of Lumber Liquidators. The stock continues to drop and Knowles and Taylor are more concerned about their own jobs (paychecks) than the financial futures of thousands of shareholders and employees.
This is the personification and embodiment of greed. And at this point, with the stock trading in the $7 range, having fallen precipitously over the last years, months, weeks and days, the fact that nobody on the board or in senior management has been fired is a likely breach of the fiduciary duty and responsibility that all of these “leaders” have towards shareholders.
- Dennis Knowles missed guidance.
- Dennis Knowles lowered already rock bottom growth estimates which he provided just a month earlier.
- Nancy Taylor has taken absolutely no action to address the failings of the management team.
- Nancy Taylor continues to receive compensation which is the highest among the company’s self selected peer group.
- Dennis Knowles will receive a record amount of compensation this year, including a record bonus award and an all time high amount of stock based compensation.
Stock Holders have seen their portfolios destroyed. Millions of dollars in losses.