Cramer's 'Mad Money' Recap: Sin Stocks

This Bud's Not for You

"If I own an alcohol stock, why don't I just buy Anheuser-Busch(BUD)?" Cramer asked. "Because I'll lose money," he said.

Cramer says that the company already commands half the U.S. beer market through its premier brand, Budweiser, and that 90% of the company's profits are already derived from sales of Bud, leaving little upside opportunity for profit growth.

Un-PC Puffery

Cramer next turned to tobacco stocks to take advantage of worldwide addiction to smoking. His top stock for the tobacco sector is Altria(MO).

The company owns the Marlboro brand, which commands a 40% share of the U.S. cigarette market. It also pays a large and safe dividend.

"In a way, you are taking blood money," Cramer said, but he urged investors to buy the stock and collect the dividends anyway. Cramer added that he's "never smoked a cigarette" in his life.

So why is Altria better than Reynolds American(RAI), also known as RJR?

"I don't care what you prefer [brand-wise], but Altria sells more cigarettes," Cramer said.

His second tobacco company is UST(symbol). The company makes and sells snuff tobacco and has recently turned around its core business.

Though Cramer says there's speculation of RJR and Altria dipping into the snuff market, either company may decide to acquire UST rather than build a business from the ground up.

Stick to Your Guns

Cramer believes that for a really well-rounded unethical portfolio, "you're going to need some guns."

Although there aren't that many companies that are pure plays on firearms, he recommends Smith & Wesson(SWB).

Cramer believes that the company, which was once only a handgun manufacturer, has taken steps to move into rifles and military arms.

His final firearms-related pick is Alliant Techsystems(ATK), which makes all the bullets for the U.S. military's M16.

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