Jim Cramer: Stitch Fix's Quarter Shows Its More Than a 'Flash In the Pan'

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The online clothing group, which is Real Money's Stock of the Day posted stronger-than-expected first-quarter earnings following its recent move towards 'direct buy' strategies.

Stitch Fix reported a breakeven quarter, topping Street forecasts of a 6 cent loss as revenues rose 21% from the same period last year to $445 million and active clients on the group's platform jumped 17% to 3.4 million. A notable portion of that gain, however, was linked to the launch of two new "direct buy" offerings -- Shop Your Looks and Shop New Colors -- that both supported inventory clearance and leveraged group expenses, reported TheStreet's Martin Baccardax.

"With the introduction of our direct-buy capability, which allows clients to choose and purchase items outside of a Fix directly on our app or website, we’ve begun taking steps on what will be a multiyear process of evolving our offering so that our personalization service can be accessed in more flexible ways," CEO Katrina Lake told investors on a conference call late Monday. "We strongly believe direct-buy will ultimately be incremental to our business from both a wallet share and addressable market perspective. And as a result, we've actively prioritized continued rollout and improvement to this capability."

Jim Cramer said that the company's earnings show that it's more than just a "flash in the pan."

"[Stitch Fix is] obviously a way that people buy clothes. It's so hated along with Revolve (RVLV) - Get Report and The RealReal (REAL) - Get Report that I always find myself thinking, why are these companies so despised? Peloton (PTON) - Get Report, too," said Cramer.