Lumber Liquidators stock gets a boost when investors confuse settlement news

Oops, wrong settlement.

When media reports hit Monday that Lumber Liquidators had its plea agreement approved by a federal judge, Wall Street reacted as if the flooring retailer had put its China-sourced formaldehyde flooring crisis behind it.

Shares shot up nearly 17 percent in the minutes after the agreement was signed and announced to the public.

But the approved agreement was for the retailer to pay a $13 million fine to settle claims it illegally imported hardwood from a Russian forest that is home to the endangered Siberian tiger.

The company had already pleaded guilty to the charge in October and the issue posed a much smaller finance problem than its formaldehyde issue.

When the true nature of the settlement spread throughout Wall Street, the company’s shares gave up much of the spike.

They closed at $13.34, up 3.3 percent.

Last February, a report on “60 Minutes” about the chain’s China-sourced laminate flooring containing formaldehyde levels above California limits sent its shares tumbling 60 percent in a matter of days, to $27.95.

The shares have not yet recovered.

Investors may have overreacted to the news before realizing what was in the settlement, Seth Basham, an analyst at Wedbush, told The Post.