Jim Cramer Defends Shake Shack's Quarter

Shake Shack Inc. (NYSE:SHAK) is one of the stocks on Jim Cramer’s radar. During the episode, Cramer discussed the company’s earnings and ensuing market reaction. He commented:

“During earnings season, when a stock comes in maybe too hot, even a good quarter might not be enough to prevent it from pulling back. Take Shake Shack, iconic burger chain. Last Thursday morning, the company reported a pretty clean top and bottom line beat with its highest restaurant level margins in six years, which is what I care about. Yet some people thought there was a fly in the ointment. Shake’s same-store sales grew at just 1.8%. Analysts were looking for 2.2%. Give me a break.

That’s hardly the end of the world, but given that the stock was up 60% from where it was trading when they reported the previous quarter, clearly expectations were high and there wasn’t much margin for error there. We had to be careful, but that’s why the stock plunged almost 15% on Thursday and fell another 7% on Friday before rebounding more than 3% today.”

Shake Shack (NYSE:SHAK) owns, operates, and licenses restaurants offering burgers, chicken, fries, shakes, frozen custard, and beverages.

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Disclosure: None. This article is originally published at Insider Monkey.