Wednesday, September 27, 2023
Homemad moneyAs Mondelez gets Peltz’d, should you buy?

As Mondelez gets Peltz’d, should you buy?

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

Cramer's proprietary research shows that time and again if you follow this activist investor into a stock, you win.

"As part of my research for my new book Get Rich Carefully I studied every big name activist to see if investors could make money piggy-backing their moves," Cramer explained.

And typically the research found it didn't pay; although there were some gains, they weren't any better than the broad S&P 500.

"However, there was one exception – activist investor Nelson Peltz.

Nelson PeltzDavid A. Grogan | CNBC

"Why is that? I think it's because when Nelson Peltz takes a substantial position in a company, he treats it as if it is his own business," Cramer said.

Cramer's research has become all the more valuable because on Tuesday .

The research would suggest that again Peltz is about to unleash shareholder value. It's something the CEO of Trian Partners has been doing for quite some time.

"Let's go over his record, starting with Heinz. Here's as stock that rallied from $41.33 when he joined the board to $72.50 where it was taken over a little less than a year ago by Warren Buffett. That's a 75% return versus the 15% that the S&P 500 gave you during the same period," Cramer said,

"How would you have done buying Wendy's after Peltz announced his involvement? How about 97% versus a 44% gain for the S&P," Cramer added. The Mad Money host said the returns were equally impressive after Peltz took positions Ingersoll-Rand, Legg Mason and Dupont.

Now that's not to say any of these gains happened instantaneously – they didn't. In some case they were years in the making.

That's because Peltz makes fundamental changes from the inside out with an eye on long-term viability. "He shuffles the portfolio of brands, slices overhead and figures out how to improve the productivity of each employee and each plant," Cramer explained.

That requires patience.

However, in the case of Nelson Peltz patience has been rewarded handsomely. Cramer believes it will be again.

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"If you want to come up with a verb for activism that has the same resonance as Google, you should say that something's being Peltz'd. Right now Mondelez is being Peltz'd and the winners will be the ones that are along for the ride."

Call Cramer: 1-800-743-CNBC

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