Zillow's stock has a lot of short-interest because short-sellers were betting the lawsuit was going to cost Zillow much more, TheStreet's Jim Cramer, co-manager of the Action Alerts PLUS portfolio, said on CNBC's "Mad Dash" segment.
"They got off very easy," Cramer added. That's why the stock is up Tuesday. It helps Zillow's business is doing well, something he highlighted in May.
While Cramer acknowledged Zillow has more to do with capturing a larger market share of listings rather than a direct play on real estate, he doesn't want to "pay up for the stock" because it seems like some of the hot markets in real estate have cooled down.
"They're doing well," but with a weak labor report and other concerns, it's hard to pay a premium for Zillow right now, Cramer concluded.
At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.