Cramer’s Take On UA, DECK & TNDM

Jim Cramer followed up on his recent recommendation to buy Deckers Outdoor Corporation (DECK) and sell Under Armour Inc. (UA), even though both stocks’ charts looked bullish. Both companies reported earnings and the results are in. Cramer was right and Deckers has shot up 15% from the time of his call after the company reported a blowout quarter, while Under Armour, which reported a solid quarter as well, lowered guidance, sending shares down 12% today. Cramer pointed out that Decker’s management was very positive on the conference call, and he still thinks the stock is a great story. Under Armour on the other hand is dealing with a glut of inventory which is forcing the retailer to discount merchandise. Cramer said this will hurt revenues, so investors should avoid the stock. Finally, Cramer reviewed a stock that stumped him during the Oct. 16 Lightning Round, Neutral Tandem Inc. (TNDM). The company helps to make phone companies more cost effective in sending traffic to other carriers, plus it’s a cash machine. Cramer told viewers that after looking into the company, it fits in well with his mobile Internet tsunami thesis and he’d buy the stock with shares trading at 12 times 2011 earnings and a 23% long-term growth rate. Join the fastest growing community of small cap investors at Stockhideout.com

Leave a Response