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Fundamental analysis: Charles & Colvard, Ltd. (CTHR)

Awarener score: 7.1

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Excellent), the business stability (Lacking) and growth (Average), and the company's inclination to return cash to the stockholders (Modest).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 5.0

  • Business has been growing at a low pace. It's been more than average in relation to peer companies.
  • Charles & Colvard, Ltd. business shows some variation, there's some risk. It looks mediocre against rivals.

Margins score: 5.2

  • CTHR profit margins -on goods and services sold- are usually good. They stand slightly better than rival companies.
  • Business profit on sales tends to be meagre. It's substantially worse when measured against competitors.
  • Profits on sales made -available to repay debt and purchase properties- are usually meagre. They remain in a very weak position compared to peers.
  • Earnings -before income taxes and interests on loans taken- tend to be hardly sufficient in relation to total revenues. They're still worse than most similar companies.
  • Profits -before income taxes- are usually hardly sufficient considering total sales, and remain weak when measured against rivals.
  • Total net profit tends to be sufficient when confronted to sales. Company stands below average when measured against comparable firms.

Growth score: 2.0

  • Charles & Colvard, Ltd. profit -on goods and services sold- has been growing at a very good pace. It's been excellent in relation to competitors.
  • In recent years, the firm hasn't always been able to profit from operations, which has been bottom tier against comparable firms.
  • In past years, the company couldn't always turn a profit -available to repay debt and purchase properties-, which compares last-in-rank when measured against peer enterprises.
  • In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
  • In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
  • In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
  • The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 10.0

  • CTHR managed to get a credit on income taxes in the past years, even though it earned money. It's been top-notch against peers.
  • Research and development expenses hardly consume a portion of revenues. It's weak when measured against competitors.
  • The company shows excellent business growth in relation to research and development efforts. It stands in a very weak position compared to rival companies.

Profitability score: 4.8

  • Charles & Colvard, Ltd. usually gets hardly sufficient returns on the resources it controls. It proves substantially worse when measured against peer firms.
  • The company normally gets low proceeds -on the resources directly invested in the business-. They remain in a very weak position compared to similar companies.
  • Profitability -in relation to owned resources- is usually modest. It ranks below average when measured against competitors.
  • In the past, got barely sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's substantially worse when measured against comparable enterprises.

Usage of Funds score: 5.5

  • CTHR usually uses a large portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is large. It stands substantially worse when measured against rival firms.
  • The company is usually investing in new property, plant, and equipment, to improve its operating capabilities, which is great when measured against industry peers.
  • In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
  • The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
  • As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
  • The company usually significantly enlarges the pool of investors, resulting in more mouths feeding on the pie of profits. It remains a disappointment compared to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands rather normal in relation to rivals.
  • The company uses a non-significant portion of genuine fund generation to reward investors. The company is usually improving its financial position, and could greatly boost stockholder rewards if it wished so. It still looks top tier when measured against competitors.

Balance Sheet score: 6.4

  • Charles & Colvard, Ltd. intangible assets (like brands and goodwill) represent a non-significant portion of resources controlled, according to accounting books, which is safer. It happens to be encouraging in relation to peer companies.
  • The company has a lot more short-term resources than short-term obligations. Liquidity concerns are most likely irrelevant. It turns to be impressive in relation to similar firms.
  • Roughly a quarter of resources controlled were provided for with financial debt. Creditors have some claims on the company. It remains top-notch against rival firms.
  • Resources controlled can be quickly made into cash, which is very good for liquidity and risk. It looks top tier when measured against rivals.
  • For every dollar of short-term obligations, the company has more than enough dollars in cash and short-term receivables. It's excellent in relation to peer firms.
  • For every dollar of short-term obligations, the company has enough dollars in cash and equivalents, which is top-notch against similar enterprises.
  • Usually, sales are on less than a month credit. It still ranks almost average when measured against peers.
  • Normally has approximately six months of sales worth in inventory. It comes up as a disappointment compared to competitors.
  • On average, it takes a lot of months from the purchase to charging customers. It happens to be worse than most peers.
  • On average pays suppliers approximately three months after the purchase. It ranks more than average in relation to industry peers.
  • The company pays its suppliers four months or more before charging its customers, so there's significant money invested in working capital. It's in a very weak position compared to similar companies.
  • Company earns net interest income on its investments and therefore is in a quite comfortable financial position. It stands top-notch against rival firms.
  • Business earnings have usually been quite good when measured against loans taken. Cutting back reinvesting in the business, it could take around three years to repay the obligations with current profitability. It ranks encouraging in relation to comparable enterprises.
  • Revenues are quite good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks excellent in relation to similar firms.
  • Resource exploitation is excellent when yearly sales are considered. This metric is normally tied to the industry where the firm belongs. It's still somewhat worse than peer companies.

Valuation score: 6.8

  • Charles & Colvard, Ltd. looks very expensive in relation to profits and financial position. It happens to be weak when measured against competitors.
  • Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains excellent in relation to peers.
  • In the past twelve months, the company consumed funds. Either it reinvested in the business or genuine fund generation might be challenging, which stands bottom tier against similar companies.
  • The company usually generates much more genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, at the current price the share might be very interesting. It's still great when measured against industry firms.
  • In the past twelve months, the company has slightly enlarged the pool of investors by issuing new shares. The pie of earnings will now be split among a little more stockholders. It came up a disappointment compared to peer ventures.
  • The company has substantial more cash than debt. It might be poised to increase stockholder payments, or to fund new business projects. It looks top-notch against similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation is very high. A lot of improvement expectations are already in the stock price, which is risky. It ranks substantially worse when measured against peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a not far from one-to-one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks rather normal in relation to rival firms.
  • The stock price is significantly below the accounting book value. Unless profitability is extremely low, the stock may be selling at a large discount. Pay attention to the other key indicators for hints. The company remains top-notch against peer firms.
  • In the past twelve months, the operating business earned little money when compared to the current stock price and financial position. It happens to be below average when measured against industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown an excellent earnings power ability when measured against the current stock price and financial position. Further analysis is recommended, as the stock might currently be undervalued. It's still impressive in relation to peer companies.

Total score: 5.7


CTHR logos

Company at a glance: Charles & Colvard, Ltd. (CTHR)

Sector, industry: Consumer Cyclical, Luxury Goods

Market Cap: 0.03 billions

Revenues TTM: 0.04 billions

Charles & Colvard, Ltd. operates as a fine jewelry company in the United States and internationally. The company manufactures, markets, and distributes moissanite jewels and finished moissanite jewelry under the Charles & Colvard Created Moissanite brand; and premium moissanite gemstones under the Forever One brand name. It also markets and distributes lab grown diamonds, and finished jewelry with lab grown diamonds under the Caydia brand. The company sells its products at wholesale prices to distributors, manufacturers, retailers, and designers; and to end-consumers at retail prices through charlesandcolvard.com, third-party online marketplaces, drop-ship, and other e-commerce outlets. Charles & Colvard, Ltd. was founded in 1995 and is headquartered in Morrisville, North Carolina.

Awarener score: 7.1

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Excellent), the business stability (Lacking) and growth (Average), and the company's inclination to return cash to the stockholders (Modest).