$3 stock way too cheap?

(Click for video linked to a searchable transcript of this Mad Money segment)

If you're interested in a spec play, new Street research suggests this stock could double.

The stock in question is Alcatel-Lucent.

"Morgan Stanley came out with a smart piece of research earlier this week, where they did a sum of the parts analysis and they figured that the stock could more than double if the business keeps improving," Cramer said. "Meanwhile, Bank of America also did a sum of the parts analysis, and their price target is 72% higher than where the stock is right now."

Cramer's done a little analysis of his own. And he too thinks shares could march higher. Here's Cramer's take:

First the Mad Money host believes the product cycle is coming to favor Alcatel-Lucent.

"At the moment, three of our country's four major wireless carriers, AT&T, T-Mobile and Sprint, are spending heavily in order to beef up their networks so they can compete nationally with Verizon," he explained. "The big spending right now is happening in 4G wireless networks, where there are only few players, and Alcatel-Lucent is one of them.

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Second, results from rivals seem to confirm the thesis. "Earlier in the week Ciena reported earnings that totally blew away the estimates. My takeaway from the Ciena call? Communications spending is significant."

Third Cramer likes the new management.

"After years of mismanagement, the company has a new CEO, Michel Combes, who took over at the beginning of April and is getting the business back on track," Cramer said. "Then, just last week, ALU announced the appointment of a new Chief Financial officer who was a former partner at Goldman Sachs, which suggests to me that the company is serious about selling some of its assets and reorganizing itself."

Fourth, the balance sheet is improving.

"The company was able to lower the interest rate on its secured credit facility, it issued $500 million worth of senior notes due in 2020, and now Alcatel-Lucent doesn't have any significant debt maturities coming until 2017." That gives new management time to get their house in order, Cramer said.

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All told, Cramer sees plenty of catalysts that could drive a rally.

"I could bless this stock simply because I believe the capital expenditure cycle should be so strong, it will benefit the entire group," Cramer said.

However, the Mad Money host also is bullish Alcatel-Lucent as a turnaround play. "The company is making tough but necessary decisions to get back on track," he added. "I believe they're about to slash costs aggressively and that too should boost the bottom line."

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