Jim Cramer -- Walmart Deserves a Pass for Taking on Amazon

Shares of Walmart (WMT) are down 3.7% Thursday after the company beat on earnings per share expectations, but missed on revenue estimates. Same-store sales climbed 1.2% in the U.S., slightly below estimates.

But investors don't seem to be paying enough attention to the company's very strong cash flow, said TheStreet's Jim Cramer, co-manager of the Action Alerts PLUS portfolio, on CNBC's "Mad Dash" segment. 

Even though operating income decreased by roughly 10%, Walmart needs to invest a lot of time and money into better personnel and improved technology, Cramer said. 

Walmart has to take on Amazon (AMZN) -- and is doing so -- which is not going to be an inexpensive endeavor, Cramer remarked.

For the most part, investors have given Walmart a free pass because it is paying to become more competitive. Cramer argued that investors will likely continue to do so going forward. 

While this is "not the kind of quarter that inspires," Cramer said, Walmart was doing what needed to be done.

At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.

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