Colonoscopy Alternative

Continuing his weeklong series featuring biotech companies with blockbuster drug potential, Cramer recommended Exact Sciences ( EXAS), a company working on a non-invasive test to detect colorectal cancer.

Cramer said that only 40% of new colorectal cancer cases are detected early, in part to the reluctance of patients aged 50 and over being reluctant to get regular, and often uncomfortable, colonoscopies. He said the survival rate for colorectal cancer is 91% if detected early, but only 11% if the cancer is not found until it spreads throughout the body.

Enter Exact Sciences, with a new colorectal cancer test that only involves mailing a stool sample to a lab. The test is currently preparing for Phase III clinical trials and is likely to seek FDA approval in 2012. While Exact Sciences' test is not a replacement for colonoscopies, given how many patients avoid the test, Cramer said it could be a $1.2 billion opportunity for the company.

Shares of Exact Sciences have risen a hefty 83% in the last few weeks, and Cramer told viewers not to be greedy, while still saying that the stock is attractive ahead of an Oct. 29 conference where it will provide updates on its testing.

Cramer said Exact Science should be considered a speculative stock, given that the company is likely to issue five million new shares in the coming months, and given that a 2012 approval is still a long way off. However, he said that the potential for this test is enormous, which makes the stock attractive.

Alcoa's Turnaround

It's time to buy aluminum maker Alcoa ( AA), Cramer told viewers in a sparkling outfit made from aluminum foil. He said Alcoa's quarterly results were not only a thing of beauty, they were also truly significant.

Cramer said normally, the notion of Alcoa being a bellwether stock is simply ridiculous, but this quarter's conference call is a "must read." He said Alcoa painted a picture of end markets that are clearly on the upswing, including aerospace, automotive and even trucks and trailers, with strong demand being seeing around the globe, from Asia to Europe to South America.

According to Cramer, the earnings estimates for the aluminum maker had simply gotten too low, making the company's six-cent-a-share earnings beat on revenue up 15% a cinch. He said the company has reduced its surplus, is seeing pricing holding firm and has earnings visibility for the first time in a long time.

With shares of Alcoa trading at a 15% discount to their historical averages, Cramer said pointedly, "Alcoa doesn't belong this low."

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