Investment guru Jim Cramer warns investors against impulsively dumping Amazon.com Inc. stock in the wake of Jeff Bezos accusing the National Enquirer's of extortion.
"If you're selling Amazon off this you're really stupid," Cramer told CNBC.
Bezos alleged Thursday in an essay published online that the National Enquirer tried to blackmail him, with the publication allegedly threatening to publish nude photos of Bezos if the Amazon CEO didn't drop an investigation over leaked text messages that ultimately ended his marriage, the Associated Press reported.
Bezos, who is also owner of The Washington Post, detailed his interactions with American Media Inc. in an extraordinary blog post Thursday on the Medium.com website.
After the tabloid published a story about his extramarital affair last month, Bezos ordered a team of private investigators to get to the bottom of how the Enquirer obtained risque texts between the executive and former TV anchor Lauren Sanchez. Since then, there's been a public relations battle.
Bezos' investigators have suggested the Enquirer's coverage of his affair was politically motivated. Bezos has been the target of criticism from President Donald Trump over the Post's critical coverage of the White House, and AMI has admitted that it engaged in what's known as "catch-and-kill" practices to help Trump become president.
For its part, AMI said on Friday it acted lawfully in its reporting on Bezos, and that it would thoroughly investigate his claims of blackmail and take whatever action was necessary, Reuters reported.
“American Media believes fervently that it acted lawfully in the reporting of the story of Mr. Bezos,” the company said in a statement.
Cramer did admit that it's reasonable for investors to be concerned about how Bezos' divorce might impact Amazon stock, as any separation agreement would make MacKenzie a major shareholder of the e-commerce giant, CNBC.com explained.
"Isn't the issue the dumping of the stock by his soon-to-be ex-wife? The stock is down huge on that," said the "Mad Money" host, whose charitable trust owns Amazon shares. "People are worried she'll blow out of the stock."
However, Cramer countered that argument, saying "focus on the fundamentals" at Amazon.
Amazon's (AMZN) stock has struggled since reporting results last week.
In early Friday trading, AMZN shares were down $35.40, or 2.19%, at $1,578.97.