Sifel Nicolaus Initiates Coverage on Armstrong wit

Richmond, VA, January 17, 2007--Sifel Nicolaus initiates coverage on Armstrong World Industries with a buy rating. Stifel analyst, John A. Baugh, says, "We are initiating coverage of Armstrong World Industries with a Buy rating based on our belief that the company can be valued in a $55-$60 range in the event of a buyout. It is our opinion that the likelihood of the sale of the 65.5% control block of stock owned by the Asbestos Trust is high and that the maximum value can be achieved by the sale to a strategic buyer or private equity firm. Armstrong's over-funded pension plan and sizeable deferred tax benefit enhances the value of this business in a sale.” Baugh added, “Our business outlook for Armstrong as a stand-alone company is mixed at best. We forecast relatively flat revenues and EBIT in 2007 based on our belief that continued strength in the ceiling tiles business will be largely offset by considerable weakness in flooring. The stock appears relatively expensive on our 2007 EPS estimate of $2.06 and has only a moderately attractive free cash flow valuation."