When Jim Cramer heard the news of the Kraft and Heinz merger on Tuesday night, he kicked himself hard for missing it. How did he not know this was coming?
The newly created food giant would sport a 3.5 percent yield, lower input costs across the board in the second half and even come with Warren Buffett's blessing and a $16 special dividend.
How could he not have recommended it recently? Especially considering that Kraft makes Cheese Whiz, one of Cramer's favorite ingredients for a Philly cheese steak. By the way, Cramer recently discovered that Cheese Whiz might have a small amount of real cheese in it somewhere.
Then again, that is the problem. The fact that Cramer had to Google Cheese Whiz to find out if it actually had cheese in it is exactly why he has not liked Kraft Foods Group for anything but a takeover play for years.
"Kraft, you see, is the antithesis of some of the biggest trends influencing the food business worldwide," said the "Mad Money" host.
Products such as Oscar Mayer hot dogs, Kraft salad dressing, Macaroni & Cheese, Velveeta and Lunchables are the complete opposite of the natural and organic trend that has swept the country.
This trend is also the reason why Cramer would rather buy WhiteWave Foods. Unlike the mystery liquid of Crystal Light or Kool-Aid, WhiteWave has plant-based beverages like soy milk and almond milk. And with WhiteWave, you get the essence of green with its Earthbound products. These are products where you can recognize the ingredients on the label and have peace of mind that you know what is in your food. Have you tried to figure out what is in an Oscar Mayer weiner lately? Don't bother, if you want to hold your lunch down.
However, the real reason why Cramer has avoided Kraft, is that he sees that the millennial generation goes for anything that is perceived as healthy. Wall Street has also figured this out and has been migrating to the natural stocks.
"They know that not only is Kraft Mac & Cheese not natural and organic, but it's metallic, as you can see from a recall notice issued just last week where the company says some boxes built to last through Oct. 11, 2015, which says something in and of itself, may have small pieces of metal in them," Cramer added.
Meanwhile, WhiteWave stock could also be an attractive addition to a portfolio, as it has roared all the way to $42 as of Tuesday, from $17.50 just two years ago. Kraft only went to $61 from $47 during that same period.
So, this is why Cramer is not kicking himself over missing the Kraft boat. However, he still thinks there could be some hope for the new Kraft-Heinz. Some of the benefits to the merger could be that Heinz will open its distribution channels overseas to the Kraft brands that are sold domestically.
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Plus, maybe 3G, the new owner of Kraft-Heinz, decided to make some money and buy a natural company like WhiteWave or Hain Celestial?
"Yes, Kraft is still worth buying, even up here. But I'm not wearing a Post-It Note that says KRFT because I missed this deal."
In Cramer's perspective, there is much more money to be made in the natural and organic space anyway.
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