Mad Money

Cramer: Ebola could boost this medical stock

Halyard Health CEO: Innovation drives product strategies
Halyard Health CEO: Innovation drives product strategies

In November 2013 Kimberly-Clark, known for products such as Kleenex, announced that it would spin off its health care division into a separate company called Halyard Health.

No need to grab a tissue or eat a tub of ice cream to mourn the breakup on this one. Jim Cramer actually thinks this made a ton of sense.

"A medical supply company simply doesn't belong under the same roof as a consumer packaged goods company like Kimberly-Clark," said the "Mad Money" host.

Additionally, with contagious diseases such as Ebola fresh on the minds of investors, this spin-off came at a good time. Halyard is expected to generate $1.7 billion in annual sales, and is the maker of surgical and infection prevention products for the operating room.

Source: CNBC

Could the Ebola epidemic really be boosting this stock on its first day of trading? Cramer spoke with Halyard Health CEO Robert Abernathy to find out if it is a distributor within Ebola markets and whether he has seen an increase due to the disease.

"Yes, we are in those markets," Abernathy said. "We manufacture products for infection control that are part of the [Centers for Disease Control] protocol for stopping the advancement of the disease. We are growing a little bit, but it's hard to tell whether it is based on Ebola, or just a normal build up of business due to cold and flu season."

The company's main focus within the first year will be to establish itself independent of Kimberly-Clark, and the second year will be to better utilize their cash surplus to make strategic acquisitions to expand in its markets.

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"The entire strategy for the new company is to dramatically shift our portfolio. Shift to high margin, faster growing medical device products," noted Abernathy.

So, while usually Cramer is not a fan of using a breakup to create value for shareholders, he's not crying over this breakup. This one might be love at first sight.

Call Cramer: 1-800-743-CNBC

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