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EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stock Under $10 that he thinks could potentially double or triple in the next 6 to 12-months. See what he's trading today with a 14-day FREE pass.

Jim Cramer: 10 Stock Picks for 2013 (Updated With Videos)

2. A Defense Giant Buys Alliant Techsystems

A few months from now the fiscal cliff will be resolved but it is already being resolved right now for the big military suppliers who know their budgets are going to be cut back drastically. Just recently Honeywell and Boeing announced they are ratcheting back their defense businesses in favor of faster growing commercial lines. But what's Lockheed Martin (LMT) supposed to do? Or Northrop Grumman (NOC) or General Dynamics (GD)? They are too big to merge with each other and the Defense Department as well as the antitrust division of a soon-to-be-more-active Obama Justice Department, would block any such deal. But would anyone really care about which of those companies buys Alliant Tech (ATS), the advanced missile system and bullet company that just secured the Pentagon's largest bullet contract of the era? This $2 billion company has been creeping up ever since it won that multi-year $8 billion contract a few months ago, a contract that I don't expect to be impacted by the dreaded sequestration. This stock used to trade at $100 a share, but the budget jitters have reduced it to $60 and I don't expect it can stay down there for long. .

I think that a bidding war could ensure that could give you a 50% increase in value.

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