Cramer Spec Stock: New Way to Play Recovery?

If you have a stomach for risk, Cramer thinks this small stock may be an undiscovered gem.

"You know that two of my favorite big-picture themes for 2013 are the roaring housing recovery, and the rebound in the regional banks," reminded Cramer.

And he said there's a company that combines both of these themes into one stock.

"I'm talking about HomeStreet (TICKER:HMST), a small, Seattle based community bank with 20 branches and 24 stand-alone lending centers, that came public about a year ago to not a lot of fanfare," Cramer explained.

HomeStreet's stock jumped 13.5% on its first day of trading, however in retrospect the move was small. After one year, the stock has returned a whopping 132%.

"HomeStreet gets the vast majority of its revenues from residential mortgages—in 2001 it was 69%," Cramer said. It was hit very hard during the recession, but since then it's been a terrific turnaround story, with a new management team that changed the loan-approval process. They've also jettisoned many nonperforming assets."

Zigy Kaluzny | Riser | Getty Images

The strategy seems to have paid off.

In its latest quarterly report, HomeStreet said it earned $21.5 million, or $1.46 per share, for the period ended Dec. 31. That compares with $7 million, or $1.21 per share, a year earlier. For the year, the Seattle company earned $82.1 million, or $5.98 per share. In the prior year it earned $16.1 million, or $2.80 per share.

Cramer said the company has growth, consistency, and rigor of numbers.

And there may be one more reason to like the stock.

In a live interview on Mad Money, HomeStreet CEO Mark Mason told Cramer, "Dividends are in the plan for this year. Our board has discussed it. We're hoping to be able to announce something later this year."

Currently the market cap is a little over $400 million.

Read More from Cramer:
Cramer: These Firms May Take a Hit
Apple? Einhorn Just Doesn't Get It!
Cramer: HOT Stock - Literally!

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com

Contact Mad Money

  • Showtimes

    Monday - Friday 6p ET
    Saturday 8a, 1p, 7p SYD
    Sunday 12a, 1a, 8a, 7p SYD
    New Zealand
    Saturday 10a, 3p, 9p NZ
    Sunday 2a, 3a, 10a, 9p NZ
  • Jim Cramer

    Jim Cramer is host of CNBC's "Mad Money" and co-anchor of the 9 a.m. ET hour of CNBC's "Squawk on the Street."

Mad Money Features

  • Grab the latest CNBC gear from the NBCUniversal Store!

  • Get a behind-the-scenes look at how Cramer formulates his investment advice. "Inside the Madness" is a column, which features e-mails and more with Cramer and his researcher Nicole Urken.

  • You’ve always wanted to hit the “Hallelujah!” button. Here’s your chance.

Mad Money Moments