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Why Hooker Furniture (HOFT) Stock Is Gaining Today

Stocks in this article: HOFT

NEW YORK (TheStreet) -- Shares of Hooker Furniture Corp. (HOFT) are higher by 4.04% to $14.42 on Thursday following the company's 2015 first quarter results which showed a 9.1% increase in net sales to $61.4 million, compared to $56.3 million from the same period last year.

The home furnishings and logistics company posted a net income of $2.8 million, or 26 cents per share versus $2.1 million, or 20 cents per share from the 2014 first quarter.

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Separately, TheStreet Ratings team rates HOOKER FURNITURE CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate HOOKER FURNITURE CORP (HOFT) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • HOFT has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.18, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has slightly increased to -$4.09 million or 3.26% when compared to the same quarter last year. Despite an increase in cash flow of 3.26%, HOOKER FURNITURE CORP is still growing at a significantly lower rate than the industry average of 151.32%.
  • HOOKER FURNITURE CORP's earnings per share declined by 44.1% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, HOOKER FURNITURE CORP reported lower earnings of $0.75 versus $0.80 in the prior year. This year, the market expects an improvement in earnings ($1.06 versus $0.75).
  • HOFT, with its decline in revenue, underperformed when compared the industry average of 17.3%. Since the same quarter one year prior, revenues slightly dropped by 3.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Household Durables industry average, but is less than that of the S&P 500. The net income has significantly decreased by 45.9% when compared to the same quarter one year ago, falling from $3.70 million to $2.00 million.
  • You can view the full analysis from the report here: HOFT Ratings Report
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