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Worried You're Late to the Market's Profit Party?

Tuesday, 5 Oct 2010 | 6:26 PM ET
Off the Charts
Cramer explains how the charts can help.

While Cramer recommends waiting for a pullback before buying a stock, he noted Tuesday that not every pullback is a buying opportunity.

"Some stocks are simply too hot to handle, even when they've come down a couple points from their highs," Cramer said. "With these too-hot-to-handle names, you just have to be willing to say, 'I missed it' and walk away."

Cramer went "Off the Charts" to consider a surging stock that pushed lower Tuesday and appears as though it could fall further. OpenTable is a San Francisco-based company that lets you make restaurant reservations online and boasts 90 percent market share in the US, he said. The company has a "fantastic" business model, which profits by selling restaurants its online reservation system and then charging them a monthly subscription fee to use it. OpenTable also earns a dollar per person booked through the system.

The stock has soared by 161 percent year to date, and the company has reported four consecutive better-than-expected quarters, Cramer said. While he thinks it's the kind of company people are attracted to because they understand its services, he said people also "get killed" because they've come too late to the party. But have they? Watch the video of Cramer's full analysis.

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