Cramer's 'Mad Money' Recap: Pike Has Yet to Peak

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Jim Cramer's stock of the week is Pike Electric (PEC), he said Monday on his "Mad Money" TV show.

Pike, a utility service company, can be played both as a trade and as an investment, Cramer said. The trade would be to buy Pike now and sell it as soon as the company either revises earnings estimates upward or announces earnings, whichever comes first. Pike is doing most of the repair work to electricity transmission lines wiped out by Hurricanes Katrina and Rita, said Cramer, and the company should have excellent earnings and good visibility.

Pike also makes sense as a long-term investment because the company is expanding across the country and is expected to grow at 10% for the next couple of years. The company is the "best of breed," lowest-cost operator in the utility transmission and distribution outsourcing market, and the stock trades at a discount to peers Emcor(EME) and Quanta Services (PWR), said Cramer.

Pike came public in July around $14. As of Monday's closing price of $17.75, Cramer doesn't believe the stock has peaked. However, Cramer would recommend using limit orders to purchase the stock as it is thinly traded.

Commenting on natural gas plays EnCana (ECA) and Chesapeake Energy (CHK), Cramer said Chesapeake is cheaper than EnCana and that Chesapeake's business is "smokin'." The company's operations were "barely touched by the hurricane."

Cramer also said he also likes the building materials stocks but that Greenspan has "cast a pall" on them by continuing to raise interest rates and with recent comments about a housing bubble. That said, Cramer likes Vulcan Materials (VMC), which is "best of breed," he said.

JDSU Ballyhoo

Cramer is giving JDSU (JDSU) a "triple buy" because of its proposed reverse stock split and improved business outlook. Most of the time, said Cramer, a reverse stock split is purely cosmetic and is a sign a company is trying to hide something. However, in JDSU's case, the share count is "ridiculous," said Cramer, and a reverse stock split will allow the company to more easily show meaningful earnings growth.

Additionally, said Cramer, CEO, Kevin Kennedy has turned the company around just in time for a "world-wide pickup in carrier spending." Kennedy has done all the things Cramer wanted him to do, he said, so it's time for Cramer to get positive on the stock, he said.

Cramer thinks JDSU's stock can go to $2.50, presplit. JDSU ended the regular session Monday at $2.01.