![Jim Cramer says Costco is a buy, Lululemon is a wait-and-see](https://image.cnbcfm.com/api/v1/image/107164319-16706315106ED2-MM-Block-F-120922.jpg?v=1670631523&w=750&h=422&vtcrop=y)
CNBC’s Jim Cramer on Friday suggested buyers find out how to method the shares of two retailers that reported earnings this week.
“Two great retailers. Two sets of expectations. One too high, the other too low. That’s the tale of Lululemon and Costco. The former was overestimated, the latter was underestimated,” he stated.
Here are his ideas on each shares.
Lululemon Athletica
Shares of Lululemon tumbled over 12% on Friday. The athletic attire firm reported a beat on third-quarter gross sales and revenue on Thursday after the shut, however issued a softer-than-expected steerage for the fourth quarter.
Cramer stated that the principle drawback with Lululemon was that its power was already baked into its inventory worth going into the quarter, which signifies that it tumbled when the corporate didn’t report good outcomes.
“Unfortunately, this kind of selling usually doesn’t stop after just one day. If you like Lulu — as I still do, by the way — I recommend waiting until next Tuesday to see if this selling that started today abates,” he stated.
Costco Wholesale
Shares of Costco inched up 0.33% on Friday. The firm missed Wall Street expectations on its prime and backside traces for its newest quarter after the shut on Thursday, however indicated in its earnings name {that a} particular dividend and membership payment enhance are possible coming.
Unlike Lululemon, Wall Street underestimated the corporate’s means to churn out a strong quarter, in accordance with Cramer.
“I think you should be buying Costco if you don’t already own it. The expectations have been wrenched out, and the upside awaits,” he stated.
Disclaimer: Cramer’s Charitable Trust owns shares of Costco.