3 Stocks Driving The Specialty Retail Industry Higher

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 191 points (1.1%) at 17,512 as of Friday, Jan. 16, 2015, 4:20 PM ET. The NYSE advances/declines ratio sits at 2,533 issues advancing vs. 578 declining with 102 unchanged.

The Specialty Retail industry as a whole closed the day up 1.7% versus the S&P 500, which was up 1.3%. Top gainers within the Specialty Retail industry included DGSE Companies ( DGSE), up 2.8%, China Auto Logistics ( CALI), up 10.3%, Trans World Entertainment ( TWMC), up 1.7%, Charles & Colvard ( CTHR), up 7.3% and Odyssey Marine Exploration ( OMEX), up 2.7%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

Charles & Colvard ( CTHR) is one of the companies that pushed the Specialty Retail industry higher today. Charles & Colvard was up $0.10 (7.3%) to $1.46 on heavy volume. Throughout the day, 340,708 shares of Charles & Colvard exchanged hands as compared to its average daily volume of 101,000 shares. The stock ranged in a price between $1.29-$1.48 after having opened the day at $1.33 as compared to the previous trading day's close of $1.36.

Charles & Colvard, Ltd. manufactures, markets, and distributes moissanite jewels and finished jewelry featuring moissanite worldwide. Charles & Colvard has a market cap of $29.5 million and is part of the consumer goods sector. Shares are down 26.1% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Charles & Colvard a buy, no analysts rate it a sell, and none rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates Charles & Colvard as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on CTHR go as follows:

  • CHARLES & COLVARD LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, CHARLES & COLVARD LTD swung to a loss, reporting -$0.05 versus $0.22 in the prior year. For the next year, the market is expecting a contraction of 960.0% in earnings (-$0.53 versus -$0.05).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Textiles, Apparel & Luxury Goods industry. The net income has significantly decreased by 153.2% when compared to the same quarter one year ago, falling from -$1.21 million to -$3.07 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, CHARLES & COLVARD LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHARLES & COLVARD LTD is currently lower than what is desirable, coming in at 33.75%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -67.80% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 68.43%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 150.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

You can view the full analysis from the report here: Charles & Colvard Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

At the close, Trans World Entertainment ( TWMC) was up $0.06 (1.7%) to $3.30 on average volume. Throughout the day, 24,294 shares of Trans World Entertainment exchanged hands as compared to its average daily volume of 24,500 shares. The stock ranged in a price between $3.23-$3.30 after having opened the day at $3.29 as compared to the previous trading day's close of $3.24.

Trans World Entertainment Corporation, together with its subsidiaries, operates as a specialty retailer of entertainment products, including video, music, electronics, trend items, video games, accessories, and related products through its retail stores and e-commerce sites. Trans World Entertainment has a market cap of $98.8 million and is part of the consumer goods sector. Shares are down 1.5% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Trans World Entertainment a buy, no analysts rate it a sell, and none rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates Trans World Entertainment as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from TheStreet Ratings analysis on TWMC go as follows:

  • TWMC's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • Net operating cash flow has significantly increased by 96.34% to -$0.20 million when compared to the same quarter last year. In addition, TRANS WORLD ENTMT CORP has also vastly surpassed the industry average cash flow growth rate of -6.38%.
  • 39.56% is the gross profit margin for TRANS WORLD ENTMT CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -6.17% is in-line with the industry average.
  • TRANS WORLD ENTMT CORP's earnings per share declined by 40.0% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, TRANS WORLD ENTMT CORP reported lower earnings of $0.26 versus $1.05 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has significantly decreased by 35.0% when compared to the same quarter one year ago, falling from -$3.32 million to -$4.48 million.

You can view the full analysis from the report here: Trans World Entertainment Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

China Auto Logistics ( CALI) was another company that pushed the Specialty Retail industry higher today. China Auto Logistics was up $0.13 (10.3%) to $1.39 on average volume. Throughout the day, 26,289 shares of China Auto Logistics exchanged hands as compared to its average daily volume of 28,300 shares. The stock ranged in a price between $1.26-$1.39 after having opened the day at $1.26 as compared to the previous trading day's close of $1.26.

China Auto Logistics Inc. sells and trades in imported automobiles in the People's Republic of China. China Auto Logistics has a market cap of $4.7 million and is part of the consumer goods sector. Shares are up 17.8% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate China Auto Logistics a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates China Auto Logistics as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on CALI go as follows:

  • The debt-to-equity ratio is very high at 4.17 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. To add to this, CALI has a quick ratio of 0.64, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Specialty Retail industry and the overall market, CHINA AUTO LOGISTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA AUTO LOGISTICS INC is currently extremely low, coming in at 1.22%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.91% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$23.88 million or 1049.58% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • CHINA AUTO LOGISTICS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINA AUTO LOGISTICS INC reported lower earnings of $0.16 versus $0.67 in the prior year.

You can view the full analysis from the report here: China Auto Logistics Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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