Editor's Note: This was sent to subscribers of Action Alerts PLUS on Jan. 28 at 10:30 a.m. EST. Cramer holds Cendant in his Action Alerts PLUS portfolio.

There are reports out today that

Cendant

(CD)

may end up selling its Wright Express business rather than going ahead with the planned carve-out IPO. Should the private-equity bidders be lining up as the reports say they are, I believe Cendant ultimately will get a better price for its transportation fleet management business than the stock market would give it.

I'm not interested in owning a Wright Express spinoff, and as a Cendant shareholder, I'd like to see management choose the path that nets the most value for the division.

As far as Cendant's stock, I think it has 5 points of upside potential in the first half of 2005, compared with a point or two to the downside. I think the shares have been in a narrow range over the past couple of months, because the company is working on so many deals.

Cendant is set to close on some acquisitions and divest Wright Express in the coming weeks, at which time I believe folks will start looking at the stock once again. And what they'll see is a company that generates solid cash flow, pays a dividend and trades for an attractive 16 times expected 2005 earnings.

With that in mind, I'm going to buy 1,000 shares of Cendant here at $22.92. This will give me a total of 6,000 shares, or 3.8% of my overall portfolio.

P.S. One of the keys to successful investing is a smart portfolio strategy. So you might want to consider a

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At the time of publication, James J. Cramer was long Cendant.

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