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Cramer's 'Mad Money' Recap: A Soviet Food and Beverage Treat

TheStreet.com Staff

Click here for an archive of Cramer's "Mad Money" recaps.

"Tonight I've got a stock that either goes much higher or gets taken over," Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

That stock is Russian food producer Wimm-Bill-Dann (WBD Quote - Cramer on WBD - Stock Picks), Cramer's second pick in his "From Russia With Love" series this week.

Cramer said the Russian economy's 6% annual GDP growth has created several outstanding stock opportunities, if investors know where to look.

WBD fits that bill: The company currently commands a 34% marketshare of dairy products in Russia and is the No. 2 producer of baby foods and No. 3 producer of juice products in the country.

Cramer says it still has plenty of room to grow as most of Russia is still underpenetrated with the company's offerings.

He cited an article in Tuesday's Wall Street Journal, which speculated that food giant Nestle may be a potential acquirer of WBD. "This company is a legitimate takeover target," he said.

Cramer also took note of WBD's low valuation. The company currently trades at only 18.5 times its forward earnings, but has a 35% long-term growth rate.

"This makes WBD cheaper than both Coca-Cola (KO Quote - Cramer on KO - Stock Picks) and Pepsi (PEP Quote - Cramer on PEP - Stock Picks)," said Cramer.

Cramer pointed out the company has raised its guidance, saying it expects 2008 sales will be 88% above 2007 levels. And he says WBD also stands to beat its raised earnings estimates.

Ready for a Breakout

Cramer recommended tobacco-maker UST (UST Quote - Cramer on UST - Stock Picks) as the second in his "Catch Up" series of stocks that are under-performing against their peers.

Shares of UST are up only a modest 5% since Cramer first recommended the company on Dec. 7, 2005. A second recommendation on Oct. 30, 2006 faired only slightly better, up 8.3% including dividends.

But Cramer says UST is ready to break out and "catch-up" to the growth of its peers.

"Tobacco is the ultimate secular growth stock," said Cramer. He noted that tobacco often does very well in low-growth, low-interest rate environments and are attractive to investors for their high yield.

UST is attractive, Cramer says, because it has done well in the smokeless tobacco space while several of its largest competitors have tried, and failed, to gain marketshare.

Cramer also likes UST for its huge stock repurchase program. The company has the authorization to buy up to 14.6% of the total shares outstanding, with 21.9 million shares still left to go in the program.

"A buyback this big could serious increase earnings per share at a time when Wall Street is lowering its estimates on the company," said Cramer.

Bottom line: UST, with its attractive 4.7% dividend yield, is ready to break out to the upside and rejoin its peers.

A Natural Gas Master

Cramer once again welcomed Steven Farris, President and CEO of Apache (APA Quote - Cramer on APA - Stock Picks) to the show to get an update on the company.

Since Farris' last appearance on Mad Money on Nov. 11, 2007, Apache's stock has risen 35% Cramer crowned the company the "king of the oil patch," citing both the company's production and reserve growth this past year as the stock's driving catalysts.

Farris noted the company's investment in British Columbia, Canada, where the company controls 414,000 acres. He called the project a "big resource potential," although he said the area does present some long-tern challenges. He said Apache would not abandon the project, even if oil and gas prices fell significantly.

Farris reserved comment on the United States' push towards ethanol as an alterative fuel, saying only that of all the clean burning fossil fuels, natural gas is the best choice out there.

Cramer called Farris one of only a handful of "bankable" CEOs that he's behind 100%. He called Apache a "master at finding new oil and gas."

Mad Mail

Cramer told a viewer in this segment that while he recommended taking profits in Omniture (OMTR Quote - Cramer on OMTR - Stock Picks) when the stock hit almost $30 a share, he wishes now that he'd recommended selling all of the company's shares.

When another viewer asked for a recommendation between US Steel (X Quote - Cramer on X - Stock Picks), Nucor (NUE Quote - Cramer on NUE - Stock Picks) and Steel Dynamics (STLD Quote - Cramer on STLD - Stock Picks), Cramer said that while all three were too expensive, he prefers US Steel of the three.

Sudden Death

Cramer was bullish on Medco Health (MHS Quote - Cramer on MHS - Stock Picks).

Cramer was bearish on Lundin Mining (LMC Quote - Cramer on LMC - Stock Picks), Western Digital (WDC Quote - Cramer on WDC - Stock Picks), McKesson (MCK Quote - Cramer on MCK - Stock Picks) and American Capital Strategies (ACAS Quote - Cramer on ACAS - Stock Picks).

Lightning Round

Cramer was bullish on Qualcomm (QCOM Quote - Cramer on QCOM - Stock Picks), John Deere (DE Quote - Cramer on DE - Stock Picks), El Paso (EP Quote - Cramer on EP - Stock Picks), Gentex Corp (GNTX Quote - Cramer on GNTX - Stock Picks), Johnson Controls (JCI Quote - Cramer on JCI - Stock Picks), Mercadolibre (MELI Quote - Cramer on MELI - Stock Picks), XTO Energy (XTO Quote - Cramer on XTO - Stock Picks), Agnico-Eagle Mines (AEM Quote - Cramer on AEM - Stock Picks), Syngenta (SYT Quote - Cramer on SYT - Stock Picks) and Temple-Inland (TIN Quote - Cramer on TIN - Stock Picks).

Cramer was bearish on Fifth Third Bancorp (FITB Quote - Cramer on FITB - Stock Picks), Visteon (VC Quote - Cramer on VC - Stock Picks), International Paper (IP Quote - Cramer on IP - Stock Picks) and Marvell Technology (MRVL Quote - Cramer on MRVL - Stock Picks).

Want more Cramer? Check out Jim's rules and commandments for investing by clicking here.

For more of Cramer's insights during the Lightning Round, click here.