Jim Cramer Goes Online Shopping: Breaking Down Stitch Fix and Chewy Earnings

Jim Cramer has some thoughts on online retailers Stitch Fix and Chewy.
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Jim Cramer weighs in on Stitch Fix (SFIX) - Get Reportand Chewy (CHWY) - Get Report.

Real Money Stock of the Day: Stitch Fix 

The online clothing group 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."

What does Stitch Fix need to do to maintain its status as a disruptor? 

And Then There's Chewy

Chewy reported a fiscal-third-quarter loss flat with a year earlier and a narrowed pretax loss.

The company reported a net loss of 20 cents a share, flat with the year-earlier quarter. Net sales increased 40% to $1.23 billion.

Analysts surveyed by FactSet were expecting Chewy to report a loss of 16 cents a share on revenue of $1.2 billion.

The company's adjusted loss before interest, taxes, depreciation and amortization was $30.2 million, compared with Wall Street expectations of a loss of $39.5 million.

And, keep in mind, the company's post-IPO lockup period, where around 83% of its outstanding shares, will end Wednesday, Dec. 11.