Jim Cramer says CEO Kevin Plank of Under Armour (UA) admitted that he "lost focus" and let the formerly hot athletic-wear company's performance slide -- a confession that Cramer said represents "the beginning of when you want to buy a stock."

Cramer said that after he recently criticized Under Armour on CNBC, Plank called and said: "'You're right, I lost focus. ... I apologize. I didn't do it right.' It makes me intrigued when you have a guy who recognizes what he did."

Cramer added that when Plank sent him a bottle of high-end rye whiskey made by a company the Under Armour CEO operates on the side, "I sent back a note saying: 'I thought you were making Under Armour.' He lost focus. [And Plank replied]: 'I'm done. I'm not going to make anymore rye.' And I said, 'Listen, I'm going to go out and say that that's the beginning of when you want to buy a stock.'

Under Armour shares have shed nearly two-thirds of their value over the past year, falling from an intraday high of $33.45 in December 2016 to as low as $11.40 in October. 

Under Armour CEO Kevin Plank
Under Armour CEO Kevin Plank

Cramer said rival Nike (NKE) has "really crushed" Under Armour, which he said demonstrates an important lesson for investors -- always watch a company's competitors.

"People should understand that when they buy an individual stock, they should be thinking about the competitors, because nobody [operates] in a vacuum," Cramer said.

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