The stock was a heavy favorite among short-sellers, but now they are being squeezed from their position, TheStreet's Jim Cramer, manager of the Action Alerts PLUS portfolio, said on CNBC's "Mad Dash" segment.
Shares have soared 36% on the year as CEO Gary Friedman finally gets some recognition for the hard work he's been doing. The company is cutting promotions and lowering the number of stores it will open, Cramer noted. Restoration also has a focus on generating positive free-cash flow, he said.
The addition of wine and coffee bars is making the company more of a hospitality play instead of just a retail play, Cramer added. Management is aiming for a better return on investment, which is good for investors, too.
They deserve this comeback, Cramer said. "They're going to have a good year in 2017."
At the time of publication, Cramer's Action Alerts PLUS had no position in the companies mentioned.