Cramer's 'Mad Money' Recap: Working on Our Night Moves

Analyst Up a Tree

Cramer played "Break the Analyst," the game where he takes an analyst's recommendation, explains why it's wrong and why one should do the total opposite.

A JP Morgan analyst gave TreeHouse Food(THS Quote - Cramer on THS - Stock Picks) an underweight recommendation, which Cramer said is gibberish for "sell."

But he said that this private-label food company, which was spun off from Dean Foods(DF Quote - Cramer on DF - Stock Picks), is a play that could make a dent in Wal-Mart's(WMT Quote - Cramer on WMT - Stock Picks) lead over supermarkets.

TreeHouse announced this month that it will acquire canned-soup and baby-food companies, but the stock went higher, Cramer said.

When a company buys another company, the general response is that the acquiring company goes down, he explained, but TreeHouse went up.

"That, to me, is a dead giveaway about where this stock is heading ... going higher not lower," Cramer said.

The analyst said that TreeHouse is too expensive for its peer group. And though Cramer said the stock has been up for a couple of days, he believes that it will not go down big.

That's because he believes the analyst is barking up the wrong tree if he is comparing it to companies like General Mills(GIS Quote - Cramer on GIS - Stock Picks) and Kellogg(K Quote - Cramer on K - Stock Picks) -- big-brand companies that he said are hurting.

Instead, TreeHouse is "exactly what the supermarkets need," Cramer said. Wal-Mart makes deals with the big brands, and that allows it to be the price leader in those brands because of its economy of scale, he said.

And as long as Wal-Mart has the cheapest stuff, it should beat the supermarkets.

So if supermarkets want to be the price leader, their niche will be in private-label goods, Cramer said, and that's where TreeHouse leads.

Plus, TreeHouse is run by the same men who ran Keebler.

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