Sky-High Profits or Space Junk?

GeoEye isn’t a stock for the faint of heart. It has a tiny market cap of $385 million, the trading volume is thin, and if it doesn’t launch a new satellite by year’s end, the stock could get hammered.

But, of course, that’s why Cramer likes it for speculation Friday.

The upside of GeoEye is that the demand for satellite and aerial imagery is growing as more and more governments use it to deal with terrorism and environmental issues. Cramer said that governments are outsourcing the work more and more rather than launching their own satellites.

The commercial use of satellite imagery is on the upswing too. Just look at Google Earth or Microsoft Virtual Earth.

There’s only one other company of note in the space: Digital Globe. But it’s not public, which means GEOY is the only pure play in satellite imagery.

The catalyst is the launch of a new satellite. It was supposed to go up early this year but was delayed. If it doesn’t end up launching, GEOY could get hit hard, Cramer said. But if the satellite does make it out of earth’s atmosphere, this $22 stock could rocket to $40.

Bottom Line: GeoEye is not for your IRA, but it’s the definition of a great spec stock, Cramer said.

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