Cramer's 'Mad Money' Recap: Heavy Duty
Click here for an archive of Cramer's "Mad Money" recaps.
Editor's note: Jim Cramer's "Mad Money" will air on CNBC at 9 p.m. and midnight EST during the Winter Olympics. Check back on TheStreet.com and RealMoney.com after 10 p.m. for the nightly recap.
Jim Cramer's favorite epidemic just happens to be his favorite way to make money -- obesity. "It's never going to go away," Cramer told viewers of his "Mad Money" TV show on Monday.The way to profit off the fat-fighting craze, Cramer said, is through the makers of weight-loss drugs. But because "we are a vain society," investors should seek drugs that "make people look good now." A hugely popular drug is Acomplia, made by Sanofi-Aventis (SFY), but Cramer doesn't recommend that stock since the impact of even a blockbuster drug on one huge company won't necessarily be a stock-mover. Instead, Cramer likes Arena Pharmaceuticals (ARNA), which has a drug about to enter Phase III testing and "should be the best thing on the market." It's currently called APD-356, but Cramer said "you can think of it as the new Fen-Phen without the heart attacks." When Arena comes out with its version of Fen-Phen, Cramer said it should become the market leader. "Unless it blows up, Arena has a great risk/reward," he said. Cramer added that Arena is also working on a "phenomenal" diabetes drug with Johnson & Johnson (JNJ), and he could "easily" see the stock hitting $20 this year. (It closed Monday at $15.02). A viewer called in to ask Cramer whether the Food and Drug Administration was hyper-sensitive to stimulant drugs at the moment. Cramer said the FDA was responding to pressure because a lot those drugs were being used by children. But the issue with Fen-Phen was "the nasty problem" of people getting killed, a problem that Cramer doesn't forsee with Arena's drug. "It's Fen-Phen without the killer app," he said. Another caller asked Cramer if there was a way to play the gastric bypass popularity. Cramer recommended Inamed (IMDC), which he says has had quite a run, but he's not willing to yet "ring the register."
A Sporting ChanceAs viewers - and investors - watch the Winter Olympics, Cramer reminded everyone that it's too late to make money on the event now. To make any money on sports, you need to be looking ahead, specifically at soccer's World Cup or the 2008 Olympics.
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