NEW YORK (

TheStreet

) -- Retail stocks rallied Friday afternoon following positive earnings reports.

Wet Seal

( WTSLA) surged 12.1% to $3.98 after it posted

better-than-expected fourth-quarter earnings

.

For the three-month period the teen retailers earned 7 cents a share on an adjusted basis on revenue of $165.5 million. Wall Street forecast a profit of 5 cents a share.

Rival

Hot Topic

( HOTT) also received a boost following an upgrade to buy from Janney Capital Markets.

Analyst Adrienne Tennant cited several structural shifts that could lead long-term positive results: the closure of stores, cost reductions and the recent change in CEO. She also foresees same-store sales turning positive over the next 12 months.

Earlier in the week,

Chief Executive Betsy McLaughlin announced her resignation

. She is replaced by Linda Harper, a board member and former CEO of

Gymboree

.

Shares of Hot Topic jumped 6.5% to $5.88 this afternoon.

Charming Shoppes

(CHRS) - Get Report

continued its upward momentum after it reported on Thursday a

smaller fourth-quarter loss

as holiday sales topped estimates.

The plus-sized women's retailer lost $30.4 million, or 26 cents a share, compared with a loss of $28 million, or 24 cents, in the year-ago period. Excluding items, Charming Shoppes actually lost 8 cents a share on revenue of $575.8 million.

Analysts were calling for a loss of 19 cents on revenue of $553.1 million.

The company also announced that it appointed Anthony Romano, chief operating officer, as its new chief executive to replace James Fogarty, who stepped down in October 2010.

Shares of Charming Shoppes spiked 11.8% to $3.87 in midday trading.

Finish Line

(FINL)

ran up 5.2% to $19.36 after it reported a 12% jump in fourth-quarter profit.

During the period the athletic footwear retailer earned 65 cents a share on an adjusted basis on revenue of $384.6 million. Analysts expected a profit of 65 cents on revenue of $376.2 million.

This report also lifted shares of competitor

Foot Locker

(FL) - Get Report

, which advanced 4.2% to $20.03.

Best Buy

(BBY) - Get Report

was one of the few retailers in the red. While shares of the electronics retailer rallied immediately following its

fourth-quarter earnings report

on Thursday, Wall Street got jittery after investors took a deeper look at the numbers.

On the surface, Best Buy significantly topped profit guidance, leading shares higher Thursday morning. But revenue was shy of consensus estimates and the electronics retailer also reported its fourth consecutive drop in comparable sales.

As a result, Citigroup cut its rating on the stock to sell from hold and slashed its price target to $27 from $36. Analyst Kate McShane foresees more downside ahead for the stock due to Best Buy's limited earnings growth potential and gross margin pressure.

Shares of Best Buy fell 4.2% to $28.86 Friday afternoon.

--Written by Jeanine Poggi in New York.

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