Cramer Discusses Restaurant Stocks

"Sometimes the best plays are also the most obvious ones," Cramer said Thursday. "With commodity prices moderating, buying the restaurant stocks is about as obvious as it gets."

After all, earnings estimates for nearly every restaurant could be raised, as the price of both gasoline and grains have peaked, the "Mad Money" host explained. For that reason, Cramer has been highlighting different types of restaurant stocks all this week. He began by addressing regional restaurant stocks on Monday and talked about national brands on Tuesday. On Thursday, he looked at international restaurant companies, including Yum! Brands , McDonald's , Starbucks and Domino's Pizza .

All four chains ran out of room to grow in the U.S. so they have been expanding overseas, Cramer said. He thinks each name has a great growth story, but prefers Yum! Brands. Although based in Louisville, Ky., Cramer said Yum! Is the king of emerging markets. In fact, emerging markets account for half of its profits. Currently, 36 percent of its sales come from China, but UBS estimates the People's Republic could represent 45 percent of its total operating profits by 2013.

Cramer also likes McDonald's, but he said it has a smaller prescience in emerging markets and is more expensive. McDonald's sells for 16 times earnings with 10 percent growth while Yum! Sells for 16 times earnings.

Although not his top picks, Cramer is also bullish on Starbucks and Domino's.

At this time, only a third of Starbucks' store base is located outside the U.S. It plans to open 400 new international locations this year, though. The problem, Cramer said, is that the coffee giant intends to copy its U.S. experience worldwide. Cramer just isn't sure $3 coffee drinks will resonate in emerging markets the way it does in America. He just doesn’t know if the brand is that powerful, but he does thinks Starbucks is a terrific turnaround story with a strong management team. While Cramer has long liked Starbucks, he can't recommend it as his top international restaurant pick.

Finally, Cramer discussed Domino's. Not only is it the number one pizza delivery company in the U.S., it gets 47 percent of its stores are international. All of its international locations are franchised, so Domino's makes money by supplying the franchises with food, equipment and supplies. Although the company is currently in 65 international markets, Cramer said it still has room to grow. The problem is that it's not a well-known brand, at least compared to the aforementioned companies. It also doesn't pay a dividend. Again, Cramer likes it, but it's not his top international name.

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