Charles & Colvard (CTHR) AI Stock Analysis

• Market Cap: $2.40M
• Dividend Yield: N/A
• Average Volume (3M): 4.21K
• Price to Earnings (P/E): ―
• Beta (1Y): -10.65
• Revenue Growth: -33.51%
• EPS Growth: 36.29%
• Country: US
• Employees: 24
• Sector: Consumer Cyclical
• Sector Strength: 80
• Industry: Luxury Goods
• EPS (TTM): -4.68
• Shares Outstanding: 3,118,273
• 10 Day Avg. Volume: 5,090
• 30 Day Avg. Volume: 4,207
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $0.50
• Price Target Upside: 56.25% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 45 Neutral
• Price Target: $0.50 ▲(56.25% Upside)

Charles & Colvard's stock score is significantly impacted by its poor financial performance and valuation. The company's strategic move to secure a convertible note agreement provides some positive outlook. However, technical indicators suggest a bearish trend, and the lack of earnings call data prevents a more comprehensive analysis.

Charles & Colvard Business Overview & Revenue Model

Company Description

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.

How the Company Makes Money

Charles & Colvard generates revenue through multiple streams, primarily driven by the sale of loose moissanite gemstones and finished jewelry products. The company markets its products through its own e-commerce website, which allows it to reach consumers directly and maintain higher profit margins. Additionally, it distributes its products wholesale to retailers and jewelry manufacturers, leveraging partnerships to expand its reach and enhance brand visibility. The company also benefits from strategic collaborations with designers and influencers, which help to promote its offerings and attract new customers. By focusing on sustainability and ethical sourcing, Charles & Colvard appeals to a growing segment of consumers interested in responsible luxury goods, thereby supporting its revenue growth.

Charles & Colvard Financial Statement Overview

Summary

Charles & Colvard faces significant financial challenges, with declining revenues and persistent losses impacting profitability. The balance sheet shows a strong equity position, but increasing debt levels pose risks. Cash flow issues further exacerbate financial stability concerns, necessitating strategic adjustments to improve performance.

Income Statement

The company experienced a significant decline in revenue, with a revenue growth rate of -26.70% from 2023 to 2024. Despite a gross profit margin of 100% in 2024, the EBIT and EBITDA margins are negative, indicating substantial operational losses. The net profit margin is also negative at -65.41%, highlighting ongoing profitability challenges.

Balance Sheet

The company has a strong equity base, with an equity ratio of 115.73% in 2024, indicating low financial leverage. However, the debt-to-equity ratio increased to 0.17, reflecting higher debt levels. The return on equity is negative due to net losses, indicating inefficiencies in generating returns from equity.

Cash Flow

The free cash flow growth rate is negative, and free cash flow to net income ratio is unfavorable due to negative cash flow and net income. The operating cash flow to net income ratio is also negative, indicating cash flow challenges. The company faces difficulties in converting its earnings into cash flow.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	21.96M	29.95M	43.09M	39.24M	29.19M
Gross Profit	5.19M	4.73M	20.24M	18.43M	7.99M
EBITDA	-14.61M	-13.03M	3.35M	6.23M	-5.67M
Net Income	-14.36M	-19.58M	2.37M	12.81M	-6.16M
Balance Sheet
Total Assets	40.98M	48.88M	69.21M	64.92M	48.90M
Cash, Cash Equivalents and Short-Term Investments	4.14M	10.45M	15.67M	21.30M	13.99M
Total Debt	4.41M	2.93M	3.70M	4.17M	1.79M
Total Liabilities	15.33M	9.11M	9.65M	9.23M	7.47M
Stockholders Equity	25.65M	39.77M	59.56M	55.69M	41.44M
Cash Flow
Free Cash Flow	-8.32M	-5.16M	-988.11K	5.99M	-286.79K
Operating Cash Flow	-7.37M	-3.88M	572.55K	6.47M	249.19K
Investing Cash Flow	-1.04M	-1.28M	-1.56M	-733.47K	-535.98K
Financing Cash Flow	2.30M	-451.81K	720.50K	1.09M	1.90M

Charles & Colvard Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.32
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CTHR, the sentiment is Negative. The current price of 0.32 is below the 20-day moving average (MA) of 0.46, below the 50-day MA of 0.40, and below the 200-day MA of 0.88, indicating a bearish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 44.72 is Neutral, neither overbought nor oversold. The STOCH value of 42.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CTHR.

Charles & Colvard Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIG	75 Outperform	$3.72B	30.35	6.82%	1.35%	-1.63%	-72.22%
ELA	73 Outperform	$195.52M	22.32	15.81%	―	25.43%	33.93%
MOV	71 Outperform	$295.61M	24.27	3.52%	7.25%	-0.65%	-51.59%
BRLT	66 Neutral	$178.37M	―	-2.83%	17.42%	-4.32%	-144.96%
Sector *	61 Neutral	$17.96B	13.14	-5.36%	3.00%	1.25%	-13.95%
CTHR	45 Neutral	$2.40M	―	-47.86%	―	-33.51%	36.29%
BGI	40 Underperform	$16.26M	―	89.94%	―	-7.08%	-162.35%

Charles & Colvard Corporate Events

Charles & Colvard Secures $2M Investment from Ethara Capital

On June 24, 2025, Charles & Colvard entered into a Convertible Secured Note Purchase Agreement with Ethara Capital LLC, resulting in a $2.0 million investment issued in two tranches, with the final closing on July 21, 2025. Additionally, the company announced changes to its board of directors, including the resignation of Ollin Sykes and the appointment of Ruten Bhanderi and James Tu, with Mr. Tu becoming the new Chairman. These changes are part of the company’s strategic alignment with Ethara Capital’s interests, potentially impacting its governance and operational strategies.

Charles & Colvard Secures $2M Convertible Note Agreement

On June 24, 2025, Charles & Colvard entered into a Convertible Secured Note Purchase Agreement with Ethara Capital LLC for $2.0 million, structured in two tranches. This agreement grants Ethara Capital the right to appoint directors and observers to Charles & Colvard’s board, while the company secures the note with its assets. The deal, subject to shareholder approval, allows for conversion into common stock and includes waivers of severance benefits by the company’s CEO and CFO, indicating a strategic move to strengthen its financial position and governance.