Jim Cramer: Short Squeeze Helping Lift Restoration Hardware

Restoration Hardware is popping after its second quarter earnings beat, but investors should be aware that there is a short squeeze at play, says Jim Cramer.

Author:: Jim Cramer
Publish date:: Sep 9, 2016 12:22 PM EDT

Restoration Hardware (RH) - Get Report is popping after its second quarter earnings beat, but investors should be aware that there is a short squeeze at work as well, says TheStreet's Jim Cramer. The Corte Madera, CA-based luxury home furnishings retailer reported adjusted earnings of $0.44 a share, handily beating analysts' estimates of $0.29 a share. The results 'were well ahead of our guidance for the quarter due to our ability to ship products earlier than anticipated, resulting in a pull forward of revenue and earnings into the second quarter from the third quarter,' CEO Gary Friedman said in a statement. Friedman also said the company is making several strategic investments and changes to its business model this year that are temporarily depressing financial results in the short term.

At the time of publication, Jim Cramer's charitable trust Action Alerts PLUS held no positions in stocks mentioned.