Cramer's 'Mad Money' Recap: A Soviet Food and Beverage Treat

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"Tonight I've got a stock that either goes much higher or gets taken over," Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

That stock is Russian food producer Wimm-Bill-Dann WBD, Cramer's second pick in his "From Russia With Love" series this week.

Cramer Interviews Apache CEO

Cramer said the Russian economy's 6% annual GDP growth has created several outstanding stock opportunities, if investors know where to look.

WBD fits that bill: The company currently commands a 34% marketshare of dairy products in Russia and is the No. 2 producer of baby foods and No. 3 producer of juice products in the country.

Cramer says it still has plenty of room to grow as most of Russia is still underpenetrated with the company's offerings.

He cited an article in Tuesday's Wall Street Journal, which speculated that food giant Nestle may be a potential acquirer of WBD. "This company is a legitimate takeover target," he said.

Cramer also took note of WBD's low valuation. The company currently trades at only 18.5 times its forward earnings, but has a 35% long-term growth rate.

"This makes WBD cheaper than both Coca-Cola KO and Pepsi PEP," said Cramer.

Cramer pointed out the company has raised its guidance, saying it expects 2008 sales will be 88% above 2007 levels. And he says WBD also stands to beat its raised earnings estimates.

Ready for a Breakout

Cramer recommended tobacco-maker UST UST as the second in his "Catch Up" series of stocks that are under-performing against their peers.

Shares of UST are up only a modest 5% since Cramer first recommended the company on Dec. 7, 2005. A second recommendation on Oct. 30, 2006 faired only slightly better, up 8.3% including dividends.

But Cramer says UST is ready to break out and "catch-up" to the growth of its peers.

"Tobacco is the ultimate secular growth stock," said Cramer. He noted that tobacco often does very well in low-growth, low-interest rate environments and are attractive to investors for their high yield.

UST is attractive, Cramer says, because it has done well in the smokeless tobacco space while several of its largest competitors have tried, and failed, to gain marketshare.

Cramer also likes UST for its huge stock repurchase program. The company has the authorization to buy up to 14.6% of the total shares outstanding, with 21.9 million shares still left to go in the program.

"A buyback this big could serious increase earnings per share at a time when Wall Street is lowering its estimates on the company," said Cramer.

Bottom line: UST, with its attractive 4.7% dividend yield, is ready to break out to the upside and rejoin its peers.

A Natural Gas Master

Cramer once again welcomed Steven Farris, President and CEO of Apache APA to the show to get an update on the company.

Since Farris' last appearance on Mad Money on Nov. 11, 2007, Apache's stock has risen 35% Cramer crowned the company the "king of the oil patch," citing both the company's production and reserve growth this past year as the stock's driving catalysts.

Farris noted the company's investment in British Columbia, Canada, where the company controls 414,000 acres. He called the project a "big resource potential," although he said the area does present some long-tern challenges. He said Apache would not abandon the project, even if oil and gas prices fell significantly.

Farris reserved comment on the United States' push towards ethanol as an alterative fuel, saying only that of all the clean burning fossil fuels, natural gas is the best choice out there.