Rates in China are only a "short-term noise"

HR CEO Friedman Friedman said Friday that it is essential that companies do not overreact to "short-term noise" and focus on the "long-term story".

Faced with tariffs on imports from China, former high-end furniture retailer Restoration Hardware mitigated the effects of the trade war and published an upward quarter in its report on Wednesday's financial results . The company's strategy was to produce good products of good quality at the right value, said Friedman.

"Being too responsive and moving in product categories like ours can be enormously riskier," he told Mad Money's Jim Cramer.

Trade tensions between the United States and China have intensified for more than a year, causing the two countries to gorge on multibillion dollar rights. Companies exposed to China, including HR, have been hit hard.

The furniture company's shares have recorded a crater of nearly 28% over the past year and the stock has shrunk by more than 7% in 2019. RH has agreed that it would face commercial hurdles and has chosen to renegotiate agreements with suppliers, raise prices for certain products, and move certain purchases outside of China.

Friedman said the company was reluctant to spend energy to relocate its operations if a trade deal could be concluded at any time.

"The Chinese government and Chinese factories are motivated to achieve good results, the US is motivated to achieve good results, and balancing trade is a good thing," he said. "I'm not afraid of this short-term chaos because I think the long-term result for the United States is going to be good."

Since its close on Wednesday just $ 95, the action RH jumped more than 17% to end the week at 111.37 dollars. Friedman thinks the stock should trade at $ 200 a share.

"We think [the stock is] Friedman said, "The overall vision of our business is just beginning."

Friedman is confident about the current position of the company. RH builds stores, unlike some other retailers, and went into debt. In the long run, HR could be worth between $ 10 billion and $ 20 billion, he said.

"People are confused about this model, because they think retail is being attacked by Amazon and others," he said. "And we are really playing at a different level and disrupting another part of the market."

Disclosure: The Cramer Charitable Trust holds shares of Amazon.com.