'RealMoney' Radio Recap: Weight Gains

There's an obesity problem in this country as evidenced by the rise in diabetes, heart disease and weight-related cancers, Jim Cramer said on his "RealMoney" radio show Wednesday.

"We can wring our hands about it. ... We can say we should eat better food ... or we can make money off of it," Cramer said.

His two money-making plays include one for people who are serious about losing weight and one for people looking for a diet shortcut.

His first pick was Weight Watchers(WTW Quote), a publicly traded company that was once a division of Heinz(HNZ Quote).

People attend weekly meetings, receive group support and learn about healthy eating. Cramer believes that this is "money in the bank" as people realize that fad diets just don't work.

As dieters realize this, they will go back to Weight Watchers because "behavior modification never goes out of style."

The company is growing at 15%, but sells at 23 times earnings. Cramer said; and he is "always willing to pay twice the growth rate" for a stock. That means if a company is growing at 15%, he will pay 30 times its forward earnings-per-share price.

The play on quick-fix dieters is Arena Pharmaceuticals(ARNA Quote), he said, because the company is developing a diet drug similar to Wyeth's(WYE Quote) Fen-Phen that should be safe.

Cramer described Arena's treatment, APB356, as "Fen-Phen without the heart attacks," but added that this claim is still speculative because the drug does not have Food and Drug Administration approval.

But Cramer believes that as obesity becomes more of a problem, regulators will want to offer something to help consumers struggling with this problem.

A caller who bought Halliburton(HAL Quote) on Cramer's recommendation wanted to know if he should hang onto it now that the stock has moved higher.