Cramer's 'Mad Money' Recap: Syneron Will Surge

Don't Dive Into DivX

DivX (DIVX Quote) is the "hottest of the hot," Cramer told viewers. The company went public on Sept. 22, and Cramer told viewers to get in on Sept. 26. The stock has been up 52% since Cramer's recommendation.

DivX makes software that compresses digital video and licenses it to companies. It has a deal with Google (GOOG Quote) and is moving into Eastern Europe and India.

The company makes the majority of its money by selling its product at a much higher price than it costs to make.

DivX is starting to get coverage by analysts and right now has four buys and one hold, giving it limited upgrade potential, Cramer said.

Moreover, the fact that its share-lockup doesn't expire until March 22 is good and bad, he said. It's good because there won't be an insider selloff until March, but it's bad because investors will be waiting for the selloff before they get into the stock.

What's more, there is a strong possibility of a secondary offering, which could crater the stock, he said.

Although it's been profitable for the past two years, that doesn't mean it deserves to go higher, Cramer said.

"I don't want you in DivX for the next few months," he said, adding that there's a good reason to be conservative. Cramer likes it a lot cheaper.