This column was originally published on RealMoney on Aug. 3 at 11:58 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.
So much for
bad quarter. So much for
bad quarter, for that matter. And so much for
troubled quarter, too.
One of the things that happens in a bull market is that you get pullbacks. The pullbacks are disguised as many different animals. Let's analyze these three pullbacks to see if we can't find something in common that explains why they need to be bought.
First, Nike actually had an excellent quarter. There were no flies on it at all, save valuation. When you review the business, much was on track or ahead of plan. But the stock suffered from a perception that the sneaker business had gotten more competitive. Now, the stock is
, making the landscape even more competitive. How can that be? Because nothing was wrong with the stock to begin with. Tough call up here to buy it now, though.
Electronic Arts fell because traders didn't do their homework. The shortfall was of the announced variety, and I don't know what more EA could have done to prep people; they still sold, like total knee-jerk players. EA was, is and will be a story about the new hardware that is rolling out over the next six months. Still time to buy.
Yahoo!'s the most interesting one. I, like everyone else, wasn't thrilled with
the quarter. But I still would be buying it, and buying it aggressively, for the reasons outlined in an excellent
cover story: The ad business, which is good for Yahoo!, is about to get better, and the meager efforts to try to stop that by the print companies banding together will fail. Yahoo!'s an ad machine, with tons of cheap inventory that it can keep producing. It's a gift that Yahoo! is down ahead of what will be a revolutionary migration online by advertisers. Don't agree? Read the article yourself. It is the strongest piece of research in favor of buying the stock I can remember.
So, hold the Nike, buy the EA -- although I like
more -- and definitely buy the Yahoo!. Those are the takeaways from these three gifts in the form of selloffs.
is now trading at March 2002 levels, if you add back the dividend. I believe that's important. It is an important stock, and it is
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At the time of publication, Cramer was long Yahoo! and GameStop.
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