Things no other companies do. Sometimes it seems that all people, other than devices thats all people like which is pretty much what we saw today with the dow sinking 98 points, the s p sliding and the nasdaq falling. 87 . Im talking about apple which gave you not one but two devices today. Some would say three with the wider screened phone and i thought all of these excited and dazzled. A phone that can play the role of your credit card but safer and a watch im confident will sell because the presentation seemed so compelling to me. The phone is going to be a lot hotter than the watch. When we heard the details of the new iphone which includes already agreed upon deals with a huge number of retailers where all you have to do is wand your phone with the point of sale device at the store the stock jumped 1. 50 from where it was. Then the apple stock was introduced and i think thats because the watch presentation occurred at the same exact time that we got chatter about how the fed will change its language in a statement next week to indicate that it might be ready to move up soon rather than wait considerable time to do so. Again the compelling issue, the compelling issue is whether youre getting another opportunity to buy am stock because of this, this parlor game that is fed watching and how it influences all stocks shortterm even as longer term many stocks will be unskacaved. Ive had one view and one view only and thats that apple shouldnt be traded. It should be owned. I heard countless people tell you to bounce around the stock. Sell the introduces. What are they trying to do . Make 70 cents . I even saw statistics that proved it made sense to execute the strategy. I mean thats better odds than a coin toss. Now after today thats 5 out of 8 dive. Definitive. I dont know i like that average of 39. 5 with the stock up five out of seven times and one of the two losses occurred during the height of the 2008 market. These longer term stats informed my review. I just wanted to watch the watch because i know we only saw a fraction of what it can do. I saw apple stock get hit at the precise moment when they revealed the 349 price point and the inability to get the watch ready for the Holiday Season but what did you expect . A 10 knockoff available immediately on canal street . This will be out of reach for every day virus but Holiday Season presents are often put on credit. Lets understand each other again. I dont like to get excited about new product introductions. They almost never move the needle. But that hasnt been the case with companies that create new products. I know lots of people turned their back on the stock because they feel that am lost its innovative touch after steve jobs passed away. I dont know the stock is up since tim cook took over. I also heard snap judgments about how it could be disappointing because you also have to buy the iphone to which i say so what theres a lot of apple products that start off as only exciting to some but then as Developers Get ahold of it and exciting to many bingo, more apps. If i could ask espn to write apps for my own apple watch id love to get an electrocharge when one of my players score a touchdown. I fear that am wouldnt be able to corral all the partners needed in time to give this a critical mass. I dont know how they did it but they scored sowore the biggest s in the world to secrecy. I like the health and wellness feature of it. There was dictations, pictures and music and cool. I like the bmw activation which allows me to see where my car is when im lost in the parking lot as i was this weekend at the eagles game but i dont have a bmw. Its the Wearable Health features that i love. I know from meetings that jobs had some pretty nontraditional ideas about health but cook is in touch. He knows that anything that monitors health will appeal to tens and millions of younger people that care passionately about their vitals and how they exercise. Do you think the organic movement is the craze . Its all about younger people linking their habits to longevity. The apple watch does everything all the other device dos and then some. Thats probably the most important feature but those that fail to understand the health of the Younger Generation will overlook it. I know that they hate stories. I see people with the go pro stock every day even though i believe theyll be huge holiday presents. I hear them talking about mobileye. There will always be devices that send stocks up. Some devices capture the fancy of the buyers and investors longer than others but then theres apple a true serial innovator. In the end theyre a stock and all stocks got pulled down today because of rumors about the fed. We know the reaction of apples new products is inconclusive but the stock is giving you a 39. 8 gain a year later, that plus the amazingness of the new products we saw today makes me feel like apple still headed higher over time which is why my bottom line remains you should own, not trade the stock of apple, the most Innovative Company of our time if not all time. Matt. Hey matt. Caller this this jim . Yeah, you got me. Caller im calling from spirit airlines. Its a cramer favorite and i know you follow it and its a crazy performer. Im wondering if you ever fly the airline. I wonder if youre concerned about the customer experience. I only fly private. Just kidding. I have to tell you when you go on a plane these days. I flew some plain in Czech Republic and did you guys have any food or drink or anything and they said what are you kidding me . Its the Czech Republic. I just assume the worst and hope for the best. I think you save. John in colorado. John. Caller mr. Cramer thank you so much for what you do. Thank you, john. Caller im a retired farmer out in colorado and i got into the market when the president of the United States recommended it and i bought your major recommendations ever since and ive done extremely well. I appreciate it. Thank you for that. Caller ive been getting involved with prospect capital. Well thats a risky situation. The reason that stock is down 8 even though it has a 12 yield is people are suspicious. I throw the red flag when i see a yield above 10 . Theyre saying be careful. Might not be safe. Youre a retired farmer and conservative guy you need the income i want you to be a little more careful. That one is one i am critical of. Gadgets and gizmos of plenty. Apple did it again. Which is why the most Innovative Company of our time is one you should own and not trade. Apples big event sent shockwaves throughout the world. But im checking the charts of facebook and google next and mcdonalds shares were down and so were shares today but is the future sweet or sour . You want to hear my take. Plus organic food maker annies was taken out at a huge premium. Now i have my sights set on the next natural name. Stick with cramer. Dont miss a second of mad money. Follow jimcramer at twitter. Twooet cramer madtweets. Send an email to madmoney cnbc. Com or give us a call at 1800743cnbc. Miss something head to madmoney. Cnbc. Com. I make a lot of purchases for my business. And i get a lot in return with ink plus from chase. Like 50,000 bonus points when i spent 5,000 in the first 3 months after i opened my account. And i earn 5 times the rewards on internet, phone services and at Office Supply stores. With ink plus i can choose how to redeem my points. Travel, gift cards, even cash back. And my rewards points wont expire. So you can make owning a business even more rewarding. Ink from chase. woont it would be the biggest ipo in history on its way, i think its inevitable that Portfolio Managers will have to do selling in order to raise tuition because Anyone Running a hedge fund or mutual fund knows to diverse identify. I see them selling profitable internet stocks and changing into alibaba which is chinas version of amazon. Its bigger than the both combined and its a lot more profitable. So which tech and internet stocks are worth buying on an alibaba ipo induced sell off . And what level should you pull the trigger at . This is going to be the biggest question phafacing investors. I feel the pressure already. Thats the question we want to answer tonight off the charts with the help of the manager director. As well as being my colleague. He likes three iconic household names here he thinks are going to be sold for alibaba. Facebook, google, and apple. All for my Charitable Trust. And he thinks the alibaba ipo could end up giving you bargains in all three stocks. Lets go off the charts to see where he thinks each one of these would be most attractive. First, check out facebooks daily chart. Facebook just made a new all time high yesterday and like alibaba its an internet company. So he thinks this is exactly the kind of Stock Traders might lighten up on in order to raise cash to buy shares in alibaba. However he also believes this is also incredibly attractive here. Making it a raging buy into alibaba weakness. This exploded out of the classic cup and handle pattern that i like so much. One of the most reliably bullish formations in the book. It hasnt looked back since. Its been a remarkable move. And for a brief period the handle before roaring ahead. Have to tell you this is probably the one weve had the best luck seeing. Facebook is now in the roaring high phase and they believe theres still more upside from these levels but thinks an alibaba induced sell off could be on its way. If facebook starts pulling back going into the alibaba ipo at what levels would he be a buyer . Before the cup and handle it made a major high at just before 72. Thats a key level. 72 is also where facebooks 50 Day Moving Average happens to be that acted as support when it pulled back in july. So thats where he thinks you should snap it up. The floor of support will hold and the stock will be able to rebound like crazy. In short facebook looks good here. The daily chart of googles class a shares. This is another high flying internet play. They probably have to sell something to participate in the alibaba deal. He points out for over a year google has been running up a steep up trend line that matches the moving average. Really its pretty obvious. You can see the bump up here. But just like facebook he likes google at these levels. But hed love to see the up trend line. Right now that line is write this number down, 570. Thats 22 or 4 below where the stock is currently trading. If google pulls down to the 579 level then he thinks youre getting a terrific entry point and should buy aggressively. Lets look at apple. Theres that am watch you can get me if youre a viewer. Just kidding. I cant accept gifts. Because they so delivered in these new products theyre to me very exciting as i said at the top of the show people will be foolish to sell the stock but you dont trade apple you just own it i wouldnt be surprise first degree they pull back more especially since they lag following product release. Theyve done it more than not the big gains usually come 6 to 12 months later. Lets take a look at apple. Hes a big fan of apple and if you dont own it here he thinks theres nothing wrong with buying some. In fact the 97 area which you can see from this chart every 15 minutes of todays trading in apple where they were before bouncing just below 98 this is it right here. This is apples daily activity. It shows not one but two powerful floors of support from the bullish trend line. Thats the black line is the bullish trend line and then the average in blue. This combination created a terrific entry point last month. If it pull backs to these levels again like it did earlier today and then bam he thinks you should be all over this one given that apple is only at 97. 99 right now youre getting a great chance to buy it when theres probably people going to sell it tomorrow saying is that all there was. Heres the bottom line. Facebook, google, and apple are all companies that have a lot going for them. Especially apple. But theyre also exactly the kind of stocks that might get sold off so that Money Managers can raise money to participate in this upcoming alibaba ipo and the charts as interpreted by ed indicate theyre 72 for facebook, 570 for google and 97 for apple. Theyre all worth owning here. But those are the Bargain Basement levels where he thinks you might be able to load up on all three, well, on what i think is going to most definitely be alibaba weakness. Im going to bank on that and keep hitting that supply theme for you so youre not blind sided by the down side of alibaba. Carl in new york. Carl. Caller booyah jim. Get rich carefully. Thanks. I have a question for you alibaba owns 35 . Will it rise . Im not crazy about weibo. I like j. D. , so far i like the price talk alibaba. Im not going to do any more than four chinese stocks. I just dont have the bandwidth to do more from the prc. Lets never forget that in the end they do have this kind of background. All right. Facebook, google and apple. All terrific names that have a lot going for them. Unfortunately Money Managers could be against them. They might have to do selling and go for alibaba. You do have terrific entry points. However load up on all three on their weakness. Much more mad money ahead. General mills. Ill reveal goodies in the grocery aisle that could be taken up next and mcdonalds had nice excuses for the weak quarter. Any hope for the golden arches . Dont forget your fitness. A major gym rat that could get jacked on a spin off. Stay with cramer. Wait, wait, wait, its wait, wait, wait. Whoa, does she have special powers when she has the shroud . No. Guys . Its the woven one the woven one. Oh, oh that gives her invincibility. Guys . No, no, no. The scarlet king is lord victors son no dont. I told you you guys are gonna be so surprised when you watch the finale youre so lucky your car has wifi. Yeah. I am. Equinox from chevrolet. The first and only car company to bring builtin 4g lte wifi to cars, trucks and crossovers. One Company Reports a 2. 8 decrease in u. S. Same store sales and says there are and i quote, broad based challenges including sluggish Industry Growth and a highly competitive marketplace, end quote. Another company in the same industry in the same company they experience sales from Single Digits to 17 . One company has intense margin pressure. The other sees margin expansion. One sees worldwide issues including critical declines of frightening magnitude in asia down 14. 5 because of corruption in the food chain. Another says the sky is the limit. Yeah, im talking on the one hand about mcdonalds. Who had dismal numbers this morning and on the other hand chipotle which is maizes with its relatively soft antifood chain Advertising Campaign that distances itself as far as possible from mcdonalds its former parent and can raise prices seemingly at will while mcdonalds has to do these dollar meals to gain any momentum. How is this possible . How can there be such dispair . For the same reason that General Mills paid through the nose to buy annies a food play with very beloved products by the way. More on that next. We had new polls showing 45 of americans seek out organic foods when they can find them. You know what, i dont know if they find them at mcdonalds. Thats what gives them the flexibility. Theyre widely hailed as enticing with excellent and warm atmosphere for a Quick Service chain that. Decision to grow in a measured fashion putting up 1700 stores at a considered multiyear pace in this country as opposed to hundreds off like so many other chains want to do as well as not expanding in europe yet let alone in asia have allowed chipotle to maintain a supporting Customer Base even though price increases and organic beef shortages are happening. They dont want to expand faster or into different concepts until they get it right. Theyre taking their time rolling out a different thai chain. Mcdonalds seems expansion everywhere. Not known for its enticing atmosphere or staffing either for that matter. These differences drive the stocks in Different Directions with mcdonalds hitting 52 week low today. If they didnt offer a 3. 5 yield or have an excellent Balance Sheet i believe the stock would have been a lot lower today. The long suffering mcdonalds shareholders are being paid to wait to see if the chain can turn itself around. They can boost the dividend to higher levels and increase the buy back by billion of dollars even as we want them to sell billions more burgers than they do. Isnt that what were looking for . But the bottom line, again, the knowledgeable consumer. Whether it be with organic and natural food or with beverages like water over soda and more important diet soda, or the need for the Health Functions that apples watch provides, the consumers become wise to the unhealthy old ways. Thats only going to get more routine as the customer fades away and the internet informed Younger Generation starts to have kids of their own breaks the old chains both the metal and hamburger kind of unhealthy eating all together. Brad in georgia. Brad. Caller whats up jim. How are you doing today . Im doing okay. It was a busy day how are you . Caller im doing good. I want to thank you for looking out for the regular guys out there and helping us get ahead in the market. Thank you so much. Someone stopped and they said hey cramer and i said yeah and he said thanks for helping the little guy. So thank you very much. Now i can apologize to that gentle man too. Caller we appreciate you out there man but the question is i want to know which stock you think has more upside between two of them. Young brands right now theyre at their lows. Not really good news in china, you know but as we know, you know, theyre a monster. Americans like to talk about pizza hut and apparently chinese pizza like their kfc when its not all tainted. My question would it be better in investing in yum brands or jackinthebox which is definitely close to 52 week highs. My friend you just made it very easy. You made it easy were buying best of breed. Were buying quality. Were buying jack. That Company Keeps reporting good numbers over and over again. I have a long history of liking yum. My Charitable Trust sold it. I cant take the pain anymore because chinas so hard. Theres no pain to own jack. Just gain. All right. Its wise to old unhealthy ways of eating. Whats good for her is good for chipotle but mcdonalds need to turn things around. Think you need to be near wall street to spot hot stocks but today the biggest gain was inside your pantry. General mills just put annies in the cart. Find out what it means for the rest of the aisle. Want to make your portfolio into a cash machine . Ill reveal one investing style you need to know. Lightning is about to strike more than twice. Im taking your calls. Rapid fire just ahead. We needed 30 new hires for our call center. Im spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast . Go to ziprecruiter. Com and post your job to over 30 of the webs leading job boards with a single click; then simply select the best candidates from one easy to review list. You put up one post and the next day you have all these candidates. Makes my job a lot easier. 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Call Liberty Mutual for a free quote today at see Car Insurance in a whole new light. Liberty mutual insurance. Holy cow, when i saw the news that General Mills last night was willing to pay 46 a share to buy annies the poorly performing and heavily shorted organic and Natural Food Company my jaw nearly hit the floor. Thats a 37 premium so where they went out yesterday and a 51 premium to where it had been raiding the past couple of days. This deal says its a total admission of defeat by a traditional packaged food company. This is not a fad people. General mills is about the longest running history of disciplined Capital Allocation out there. Great brand names and they were willing to pay through the nose to buy annies a company thats disappointed for multiple quarters even if it does have a reputation for being the healthiest Snack Company out there. To me this is a huge development. We know that theres a major consolidation going on in the supermarket aisle. Just remember the bidding war for hillshire brands but the big traditional packaged Food Companies are willing to pay up more aggressively to gain exposure to the fast growing organic and natural business. Just consider the General Mills paid 42 times forward earnings to buy annies. That price to earnings ratio moldable to some of my favorite gains and hain will be worth 172 and whitewave which trades at 26 will be worth 50. In short every organic and Natural Food Company could be a take over target at much higher prices than we thought yesterday. There was a huge inventory last quarter and it certainly had to absorb a 30 increase in the price of food. Also they have been moeing the competitive environment despite that we all know that the organic and natural food space is the one area of the food business thats competitive. The ceo of whitewave and hains told me repeatedly here on the show theyre both desperately trying to meet the demand from a variety of large stores. Everybody from kroger to walmart to costca to whole foods is willing to sell their products. Theyll be able to pay for them. Whitewave bought earth bound farms and theyre taking their plantbased drinks to china where theyre so much cleeper and fresher than traditional milk and they figured out how to leverage it beyond the slow going milk category to compete with annies. They have plenty of organic snacks on its own. It has soups, beverages, yogurts and is looking like an organic General Mills. At their current evaluations they make Better Bargains than annies. A few years ago they were cheaper unlike annies. It had been on a full on downturn. You know ive been a long time fan of hain and whitewave and like them at these levels but theres another company entirely i havent been that crazy about. Theyve had huge runs. Annies is well off its highs and was bought to give General Mills more organic and natural exposure. If they were willing to buy annies someone else will be willing to pay up to buy bolder brands bdbd. Its the leading player and the Fastest Growing package food Company Segment out there. The glutenfree segment. Yeah, thats part of the natural and organic frenzy. Even people that dont have allergies are now eating glutenfree foods. In the last three years this is going from a specialized need to a broad trend thats become popular with the population. The makers of the glutenfree food as long with organic and natural brands like earth balance for plant based diets. Smart balance for healthy diets and evolve for healthier frozen foods is the closest thing to a pure play out there. Now border brands is a tiny company and could be easily gobbled up by kellogg, campbell soups or Pinnacle Foods that just got slammed today. All of these guys could use some of this exposure to the organic and natural business or some would say it because bolder is so small. If you value it the same way General Mills valued annies. It would have a 71 gain. Just like annies theyre far from perfect. They had a red flag on the stock for all the last year for all the reasons rising competition and glutenfree space, inconsistent execution and decelerating growth. He prefers for his company to be independent and annies has a diverse array of iconic brands where as bolder brands, the brands themselves are a lot less. Given how inconsistent annies has been i have to wonder if the problems matter. Getting in on that market might be so attractive that they ignore the hair on the story. It happened with annies. Wouldnt surprise me if it happened again. The traditional food chain surrenders to the natural and organic players with General Mills paying a huge premium for annies one of the poorest natural and organic operators out there. If annies could be taken over like this so can hain or whitewave or bolder brands. They have been turned upside down and all have to make moves like what General Mills did just last night. So if these natural and organic stocks drop back to where theyre trading just a few months ago before this most recent explosion i bet well get major deals to come in the hottest space in the food business or should i say the only hot space in the entire business. Stay with cramer. Take and. Exhale. In. Aflac and a gentle wavelike motion. Aahhh ahhhhhh. Liberate your spine, ahhhahhhhhh aflac and reach, toes blossoming. Not that great at yoga. Yeah, but when i slipped a disk he paid my claim in just four days. Ahh four days . Yep. Find out how fast aflac can pay you, at aflac. Com. It is time its time for the lightning round. You hear this sound and then the lightning round is over. Are you ready . Lets start with marilyn in michigan. Caller thanks mr. Cramer for taking my call. Of course marilyn thank you. Caller im concerned about a stock you recommended 3d systems and the ceo was on and he found it very convincing concerning the type and im wondering now do you think i should sell or hold . I paid 81. Lets be careful. I dont like 3d systems i like stratuses. I dont want you in 3d systems i would sell that and i would buy stratuses that had a good meeting yesterday. Larry please. Larry. Caller booyah. I got a he question about eog. I sold most of it today but i was wondering if you think its a good time to get back into it. I was talking about this to stephanie. We sold a lot of the oil companies. Back in first with the dividend stops because theyre really the dividends and the yields are starting to get big and then with the eogs and continental resources. Not yet is the answer to that question. Ryan in massachusetts, ryan. Caller booyah from austbost. Today i got for you linkedin. It had a great quarter. No denying it. They have been caught on the wrong side of the thing and i think that the stock can actually head still higher. Be careful. It will be a stock that is sold to raise money for alibaba. That would be your chance. Dont pull the trigger until you get that. Dave in florida, dave. Caller jim this is dave in north miami. How are you dave . Caller good. I bought energy xxi and now it has a 52 week low. What do i do . The most recent decline is because of the decline in oil prices. Ive been very disappointed in the stock. The stock has been a disaster. We had them on last time. At least the decline. This time its because of the price of oil. Bill in florida please. Bill. Caller mr. Cramer. Its a pleasure and honor to speak to you, sir. Jim im a retired and im definitely interested in yield. A little growth would be nice too. Right. Caller but i invested in cedar fair because i thought it was a fairly stable stock and im down about 10 . Well, it has been disappointing. It did not have a good quarter. I think it is a very well run company. I think its a one time only thing. Im not distancing myself. This is not a seaworld situation. Its better than that. Allen in illinois, please. Allen. Allen. Allen . Caller hello. Hey, allen, youre up. Its jim. Lets go to work. Caller hi kkr. Theres one that has a high yield that i trust and that ladies and gentlemen is the conclusion of the lightning round. The lightning round is sponsored by td ameritrade. In. The shell brought him great fame. But then, one day, he noticed that everybody could have a magic seashell. [ indistinct talking ] [ male announcer ] right there in their Trading Platform. So the magic shell went back to being a. Shell. Get live squawks right in your Trading Platform with thinkorswim from td ameritrade. Get live squawks right in your Trading Platform wait, wait, wait, its wait, wait, wait. Whoa, does she have special powers when she has the shroud . No. Guys . Its the woven one the woven one. Oh, oh that gives her invincibility. Guys . No, no, no. The scarlet king is lord victors son no dont. I told you you guys are gonna be so surprised when you watch the finale youre so lucky your car has wifi. Yeah. I am. Equinox from chevrolet. The first and only car company to bring builtin 4g lte wifi to cars, trucks and crossovers. A couple of weeks ago a company i havent talked about in ages lifetime fitness have about 112 Fitness Centers across the company are converting into a Real Estate Investment trust. Weve seen a lot of these. Im going to explain what they are and why theyre happening and how much money you can make if they make the switch themselves. Now this reconversion trick is one of those dark holes that only the professionals know the way around. Its understated too. The big boys make all the money every time they hear conversion. Now theres all sorts of Real Estate Company that invest in real estate or mortgages and what they do is totally their call. Thats why theres all of these different variations. I dont have you apartment reits, retail re tirits, indust reits and now lifetime fitness is becoming a gym reit. The other thing is they have to pay out about 90 to shareholders in the form of a dividend which allows them to avoid paying taxes on that money although as an investor your dividends are taxable. That goes to the more favorable one. Theres mar than 200 mutual funds dedicated to investing in them and every time theres a new one these guys come in and. Bye buy buy buy. What matters here and what weve seen later is Many Companies with regular corporate shareholders are converting into Real Estate Investment trusts boosting the valuation of their stocks. Once you turn into a reit you eliminate the Corporate Tax bill. Weve seen all sorts of Companies Make the overseas acquisitions to do whats known as tax inversions. Deals that allowed them to pay lower taxes in some other jurisdiction but if you have a company that does that anyway turning into a reit is a great way to stop paying taxes in awe way thats legal. Theres also an element of financial alchemy here. Typically they sell more more than 22 times earnings. So thats a big premium where even this expensive stock market is trading. No wonder lifetime fitness floated the idea of making the switch. The stock does tend to go higher as yield oriented investors buy the stock hand over fist. Stocks tend to pop by roughly 7 over the next month. Lifetime fitness is a bit of an exception. When the news broke the stock sored from 41 up to 48. A 60 gain in a single session and i think honestly you could even have more room to run even though it is stalled 1 above where it closed that day. Sometimes there can be complications when a company tries to turn itself into Real Estate Investment trust. Theres too much nonreal estate revenue. But then its often worth the hassle of restructuring to get the benefits of reit status. They could benefit enormously from becoming a reit. My family loves these Fitness Centers but you could see it as the company that owns the real estate underneath many of the Fitness Centers. They were considering they would split the company into two entities, running the Fitness Centers and a Property Company. One that a reit would own and acquire and lease the internet. The reit side would get all the property including the 77 fitness Clubs Company owned and end up paying a dividend which would be a big change from the current lifetime fitness that doesnt have any dividend at all. Hence the reel evaluation of the stock. I expect the actual conversion to happen next year once lifetime fitness receive ace private letter ruling from the irs. Its possible that lifetime wont get the nod but i think the rental set up will pass. So if lifetime fitness goes through with this plan how much money could you make by owning its stock right here . Would you do well if you bought it at 49 . How much more would ltm be worth . This is a bit tricky because they would be the first of its kind. The only Fitness Center reit in the business but the best way is doing a sum of the parts analysis. This is indeed a break up story. We have to figure out what the operating company and Property Company would be worth as separate entities. Lets start with the reit side of things. Assuming the Real Estate Investment trust component can pay out a 6 dividend yield which is lightly above the average then they can have a 4 Interest Rate on their debt and then you get a business worth 25 a share. Then theres the operating company itself and theres a lot of debate about how to value lifetimes core business of running the Fitness Centers. The business has been under pressure of late over the last 18 months. Negative membership trends as were seeing increased competition from smaller Fitness Studios and clubs. Lifetime is fighting back though watching a slate of higher end Fitness Centers in targeted areas that could outperform. They already rolled out five of these and theyre doing well. But because the story is about lifetime unlocking the value of its real estate assets through the reit conversion i want to take a conservative approach here. Lets say they only get an enterprise mobile of 6 . Thats the enterprise value divided by the earnings even though historically they had an enterprise multiple of 8. 8. With my more conservative evaluation they would still be worth 35 a share. Thats conservative and im not saying the core business will stagnate here. I like the new higher end concept but even if it does im still using a 35 target. We do quick math and we get a price target of 60 for the combined entity. Thats what lifetime fitness could be worth if it spins off the real estate under its Fitness Centers as a reit and is 21 higher than what the stock closed at today. Not bad. Thats why these conversions can be such a powerful tool for unlocking value. I know its difficult but i had to explain this to you. Heres the bottom line, transforming into a Real Estate Investment trust is the proven way to slash your value and unlock value for shareholders. This is why i think lifetime fitness is a buy here. Now that theyre considering a spin off and reit conversion plan. I bet they go through with it and the stock hits higher even as the business is not on fire at the moment despite the love for health and fitness that continues to sweep through this very show and yes the whole country. Stick with cramer. Guys youre not gonna believe this watch this. Sam always gives you the good news in person, bad news in email. Good news fedex has flat rate shipping. Its called fedex one rate. And its affordable. Sounds great. [ cell phone typing ] [ typing continues ] [ whoosh ] [ cell phones buzz, chirp ] and we have to work the weekend. Great. More good news its friday woo [ male announcer ] ship a pak via Fedex Express saver® for as low as 7. 50. [ male announcer ] ship a pak via Fedex Express saver® in a we believe outshining the competition tomorrow quires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. I make a lot of purchases foand i get ass. Lot in return with ink plus from chase. Like 50,000 bonus points when i spent 5,000 in the first 3 months after i opened my account. And i earn 5 times the rewards on internet, phone services and at Office Supply stores. With ink plus i can choose how to redeem my points. Travel, gift cards, even cash back. And my rewards points wont expire. So you can make owning a business even more rewarding. Ink from chase. So you can. Heres what youll hear tomorrow. Youll say that the apple iphone, well, disappointing. Say the big screens, disappointing. Well say the watch, disappointing. This is what people say. Weve been disappointed all the way to the bank. So when apples down tomorrow and people freak out and they say you know what that cramer is completely washed up, heres what i have to say, go pound sand. Theres always a bull market somewhere. Somewhere. I promise to try to narrator in this episode of american greed. Kwame kilpatrick. The youngest mayor in the history of detroit. I was elected mayor at age 31 years old because i dared mighty things for the citizens of my city. There were many people who believed that he was the next generation of leadership. Narrator a leader who many hope will bring the swagger back to the motor city. He was the hiphop mayor. He was hanging out with the athletes. Narrator but his outrageous temptations lead to unimaginable corruption. From the day he walked in, this was about, how can i make kwame kilpatrick, my family, and my friends richer . The mayor had 840,000 in unexplained cash in hi