When rumors spread about takeovers, it's routine to see the stock of the acquiring company take a hit, but that's not always the case. When news of an acquisition breaks and the acquiring company's stock goes up, Cramer says you've found a winner. On Monday two such takeovers happened - Bucyrus buying Terex for $1.3 billion and TreeHouse purchasing privately owned Sturm Foods for $660 million.
In order to pay for the deal, TreeHouse will have to do an equity offering, which normally drags a stock lower, but combined with bullish investor calls and raised guidance from the company, the stock shot higher. The stock has some interesting opportunities, but have you missed the curve? Should you be a buyer of TreeHouse right now? Not right now, but soon, says Cramer, who advises to wait for the secondary offering before buying in.
You want in on this deal, he says, and to get the full picture Cramer is talking with the CEO of TreeHouse, Sam Reed. He's a money maker, says Cramer, who reminds that the stock has been up 44% since the last time he was on the show in March.
To get Reed's full perspective on the company and its future investment prospects, check out the video!
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