NEW YORK (TheStreet) -- After shares of Qualcomm (QCOM) - Get Reportcaught a boost Monday over a reported settlement with Chinese regulators, the stock is again higher Tuesday by 3.75% on confirmation that the deal is complete.
Qualcomm will pay $975 million to settle the Chinese antitrust issue, which is much less than the $2 billion expected by TheStreet's Jim Cramer, co-manager of the Action Alerts PLUS portfolio.
This is viewed as a slap on the wrist because of how much cash Qualcomm has, Cramer said on CNBC's "Mad Dash" segment.
Ultimately, the stock will rally on this news because China was acting as a large headwind, and shareholders seem to love the stock, he said.
However, Cramer doesn't recommend it on the long side. The company's gross margins seem likely to decline, and other semiconductor stocks look more attractive, such as Cypress Semiconductor (CY) - Get Report , Qorvo (QRVO) - Get Report and Skyworks Solutions (SWKS) - Get Report .
Cramer turned his attention to Starwood Hotel (HOT) , after the company delivered strong earnings results.
Starwood missed on top-line expectations but beat earnings-per-share estimates of 76 cents by 21 cents a share. As a result, shares are higher by 6.3%.
-- Written by Bret Kenwell
At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.