UPDATE 2-Lumber Liquidators Q2 beats Street, ups '09 view

* Sees 2009 EPS $0.85-$0.91

* Sees 2009 revenue $528 mln-$538 mln

* Q2 EPS $0.25 vs est $0.23

* Q2 revenue rose 12 pct to $143.1 mln

* Shares rise 23 pct (Recasts; adds analyst comments, details from conference call, updates share movement)

By Abhishek Takle

BANGALORE, Aug 5 (Reuters) - Hardwood flooring retailer Lumber Liquidators Inc (LL.N) posted a quarterly profit that beat market estimates by 2 cents as newer markets boosted sales, and raised its full-year outlook, sending its shares up 23 percent to a lifetime high.

Lumber Liquidators -- which mainly competes with independent U.S. retailers and with much bigger chains like Home Depot Inc (HD.N) and Lowe's Cos Inc (LOW.N) -- has been able to attract customers in spite of the housing market turmoil and recession due to its lower prices.

The company, which sells its products at prices 2 percent to 40 percent lower than its rivals, buys its wood directly from mills and builds its stores in lower-cost locations.

"When you look at the numbers, it's clear this business model works and it's clear there's still a huge opportunity ahead for this company, not only in terms of market share but also in terms of operating margin improvement and operational improvement," Keybanc Capital Markets analyst Bradley Thomas said.

Lumber Liquidators expects same-store declines to slow down as it goes into the second half of the year.

Same-store sales fell 1.8 percent in the second quarter, a sequential improvement over a first-quarter decline of 5.8 percent.

"The comparisons get easier so it seems reasonable to assume that comps can at least maintain this trend if not improve," analyst Thomas said.

On a conference call with analysts, the company also reiterated its 2009 capital expenditure forecast of $10 million to $13 million.

For the full year, the company expects to earn 85 cents to 91 cents a share for the full year, up from its earlier forecast of 76 cents to 86 cents a share.

Revenue is expected to come in between $528 million and $538 million, an improvement over its earlier expectations of $515 million to $530 million.

For the second quarter, the Toano, Virginia-based company saw net profit rise 18 percent to $6.9 million, or 25 cents per share, compared with $5.9 million, or 22 cents per share in the year-ago quarter.

Revenue at the company, which entered seven new markets during the quarter, rose 12 percent to $143.1 million.

Analysts, on average, were expecting the company to earn 23 cents a share, before items, on sales of $139.8 million, according to Reuters Estimates.

Lumber Liquidator shares were trading up $3.37 at $20.55 Wednesday afternoon on the New York Stock Exchange. (Additional reporting by Nivedita Bhattacharjee in Bangalore; Editing by Jarshad Kakkrakandy, Anne Pallivathuckal)