Cramer Pans Crocs Long-Term But Likes It Short-Term

On tonight’s MAD MONEY on CNBC, Cramer was on a back-to-school tour at University of Virginia with a couple of stock picks.  He thinks the two most exciting stocks in this market are Under Armour (UA-NYSE) and Crocs (CROX-NASDAQ).   CROX more than doubled since his first call and he has been saying take ‘some’ of it off the table and keep some.

On his second feature on the show tonight, he wanted to discuss how to tell a fad from a hot name.  He already said Under Armour has what it takes to be the next Nike.  What about Crocs?  CROX more than doubled since his first call and he has been saying take ‘some’ of it off the table and keep some.  The brand of Crocs is very strong and sold through 6,000 retailers.  The brand is good but it is not an Under Armour.  He thinks the brand is good for shoes and sandals but their apparel wouldn’t work if they tried it.  In the end it is just a shoe company to Cramer and is a niche.  He thinks at some point it will hit a wall and never recover.  He thinks it could be a Deckers (DECK) that makes Uggs, but that is just an $800 million company and Crocs is worth more than $2 Billion.  Cramer thinks that 2007 will actually be a good year for Crocs and you can make money buying it over the next quarter; but long-term he doesn’t like it as much.  36% of the float is short.

Shares of CROX fell 3% on the long-term pan, but since he said it can still be used to make money the stock is only down 0.5% at $57.25.

Jon C. Ogg
February 7, 2007