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before we commit any more capital. "mad money" we'll be right back. coming up, in plain sight, have you ever gone for the cheapest store brand at the pharmacy, then this might be the best stock you've never heard of as the big names fight for domination in the drug store, could this steady player give you relief? don't miss cramer's exclusive with parago's ceo. later, online reservation's giant open table served up profits in the first quarter. but can it compete as more diners want dinner plans on the move. cramer hosts the ceo for an exclusive interview just ahead. [ music playing ] [ driver ] today, my ambulance knew all about a bike accident,

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with the economy looking like it's really starting to come back, especially after today's fabulous jobless claims figure, what happens to all the knockoff tradedown plays? well consumers buying the store figure, what happens to all the knockoff tradedown plays? well consumers buying the store brand versions from food to medicine switched back to the nationally branded stuff because it comes with a brand name or slightly better packaging or will they stick with private label because after all, it's the same stuff and costs a whole darn less. i have a way to clang the consumer's mindset so it will not be reversed. take perrigo, whose number could go be growing. they have a generic drug business and a decent size nutritional division. perrigo missed the headlines slightly. it was supposed to be 2 cents shy of the estimate.

some said revenues were a bit light. however the company re-affirmed its guidance and while the stock dot dinged on the news, it rebounded most of the way back. perrigo has given us a 23% gain, that was february of last year. let's check in with the chairman and find out more about the quarter and where his company is headed. >> good to see you. >> good to see you. >> this is some time for you guys. it was a great quarter, somehow the headline didn't capture the year over year revenue in growth strength. >> now, we had 18% growth, jim. we were so excited about that, in our largest business, consumer healthcare, we had 20% growth. we are doing well with that. importantly, it's giving us a launching pad like pet care.

>> let's talk about pet care. you are making some moves. this is not the same old perrigo. it's regarded not as proprietary in that you are buying labels that i didn't think were perrigo's. you're making more money. >> that's correct. we got into pet care. i think everybody knows how much you care about your dog and cat. if i ask my wife, me versus my dog, i'm not sure how that would work out. nonetheless, we felt that if we can get into pet care, we can bring out a quality product, make it more affordable, make it a win for the consumer and retailer will get better margins, obviously, indeed, it's a triple play. >> we're hitting into triple plays. let's drill down on something. we have been saying the economy is coming back, but the consumer is not -- this one permanently scarred the consumer. they discovered that these are the same. isn't that what really happened

>> that's exactly what happened, jim. what consumers have realized is we meet the same fda requirement as the national brands, however, we give them a 25-35% savings. the retailers are saying if we used more and more store brands, we'll improve our operating margins as well. that's what the retailers are doing and the consumers are realizing it. >> did the mindset change? did people think you were out of a job if you buy these? now people think you are stupid if you buy the other. >> we're moving towards that direction, absolutely. we know once a person tries the store brand product, 91% of the time they will stay with store brand. so it's given confidence that they are getting the same safety and effectiveness of a national brand. >> i know you are very kind, you talk about johnson & johnson, my charitable trust owns it. you say they are coming back. you aren't willing to say they are going to take share back? >> we think johnson and johnson

is a great company. nonetheless, consumers have made a decision to come over from national brand to store brand. we think we will hang on to a share now that j & j are out of the market. >> a lot of people say what >> a lot of people say what matters to you is new products coming off patent, there's two components, though, once it's not a prescription, it can move over, you can get share. the amount of use skyrockets. >> we are delighted to say as we look towards the next five years in our strategic plan that we see about $10 billion of drugs that are branded prescriptions. >> $10 billion? that's more than when i saw you last. >> that is correct. over the next five years, we expect those to move from prescription to over the counter. that's clearly a very important part. the other part is that in drugs like this zyrtec product.

once a product goes over the counter, usage by consumers can go up as they get easier access, that product tripled the usage dosage forms once it went from prescription to otc. >> one thing since i saw you last, you leapfrogged, you are actually developing superior containers for your products. that matters. >> that's important. in our infant formula business, one of the things we knew was important, the more we made them look like the national brand, it invites consumers to compare. our products meet the absolute same safety as the national brands. but if they look like a national brand, it invites the consumers to compare. in the case of our infant formula business, it's been very well received. it's very early yet, but very well received by the consumers and retailers. >> i thought that stuff was hugely expensive. what's the price difference? >> we're about a 50% discount. it's the same thing. >> you look at the same thing, right, exactly the same. >> we acquired a business that

was a national brand infant formula manufacturer, acquired that business, took out the marketing but kept the same nutritional requirement. that's how we're able to offer a lower price to consumers. >> you have been very inquisitive since i've seen you, this rosemont, a big deal? >> it's a big deal. we're trying to go into adjacent categories but also geographic expansion. we have a chance to go into the u.k., a nice business, a growing busniess, great margin. that's how we have been improving our operating and gross margin of our company. >> mucinex? >> it's a great product. but a very expensive product. we found a way to overcome that patent and bring out a store patent and bring out a store brand private label mucinex at a significant discount. we launched it in march, looking forward to next year's cough/flu season.

>> what will be your full product? >> i think the mucinex is clearly one of the big ones. beyond that, we have additional products we'll be looking to enter. so the rest of the mucinex family. there is mucinex d and a dm. those are other products we are looking at into our 2014 time frame. >> one of our companies is pet smart. are you going in with sergeant's brand or pet smart brand? >> both. we are in with sergeant and we will bring out a store brand flea and tick product. we are excited about that. that's what the sergeant's acquisition gave us is the opportunity to bring our private label into the pet smarts of the world. >> you have done it just in the last 15-16 months. that's an incredible number of things you have done. that's why i think the numbers are totally sustainable. if you just stayed the same, it might be different. you didn't. that's joe papa, he's the

perrigo chairman and ceo. you would have known, this was a pretty darn good quarter. mad money is back after the break. coming up, online reservations giant open table served up profits in the first quarter. but can it compete as more diners want dinner plans on the move.

if there's one thing we

can't stand when we're picking stocks is competition. show me an issue where there is no meaningful competition, i will show you a stock that is probably worthless. take open table, a company that makes it possible to make reservations at over 20,000 restaurants in america and if you want to make a reservation on the web, you do it through open table. company got started in 1998. now many restaurants can't afford not to be on it. if the restaurant wants to use an electronic reservation book, they need the pay a one-time installation fee and training the staff to use it. they pay a monthly fee and open table gets a fee for every customer that gets seated through their system. open table gets a hefty cut. you know what, it's worth it for the restaurants, otherwise they might not be able to fill their places. a real problem. because whatever open tables they have that aren't used that

night are dead weight losses. open table reported a week ago. the company beat the street's earnings estimates on a 40% basis. it's rising 15.5% year over year. they gave inline guidance with some exciting acceleration in diners seated. i regard that as a key measure. open table has given us a nice 28% gain since we spoke with the ceo last year. can it keep rebounding? let's talk to mr. robert, the ceo. >> thanks for having me back on. >> matt, i felt the key number so that people are very excited is that you did have this increase in acceleration in diners seated in the first quarter. is that something that's sustainable? >> i think it is. you are right to point out it is a key metric. we have a huge growth opportunity in front of us. we are only 15% of reservations in north america. 3% internationally. so high growth rates are absolutely in our future. >> one of the things we have

been featuring on our show, you have possibly, even groupon, yelp, mobile, open table is going mobile. how is it helping your sales? is it causing an acceleration? >> it's a massive positive for our business. we are in the hands wherever and whenever they're thinking of dining out. the second thing is we don't have to rethink how we make money on mobile. we monetize on mobile the same as the desktop. two big positives, it was 36% of our seated diners in north america last quarter went through our mobile. >> okay. now, i want people to understand the breakdown of how you make your money. north american reservation revenue grew 22%, component subscription revenue grew. are there other streams of revenue consumers should be thinking about? >> reservation alone is 60% of our total revenue. >> how about the -- is there

anybody else that is trying to get into this business? i remember when google bought zagat, i thought maybe they would do it. thought maybe yelp would get into it. >> they're partners of ours. it's a misconception from a competitive perspective, it's a partnership situation. really, importantly, it is, i feel better than ever about our competitive environment only because we continue to invest behind our customers. we are doing new products, new services all the time and investing behind those relationships. i feel very good about our competitive position and dynamic. >> i think the united states is coming back. people are going out more. are you in some countries where i worry about the financials. i know you have a big position in the united kingdom, but that economy is not that good. couldn't that pull down the growth rate entirely for open table? >> you know what's interesting, if we look at the industry overall, because we're in the world's leading network, we have the ability to look at the total

book of diners, not only the dine-in piece, but the phone-in and walk-in piece as well. we're seeing in the last quarter, year over year the industry was down 1-1.5%. so there isn't a tailwind. overall, we're looking forward to a tailwind emerging over time. >> fair enough. i know about the foreign exchange issues. i was with danny meyer recently. i know he's close to your company. he feels this company is coming on very strong. then i read the paa research. i try to get every single view on this show. this fella says why is everyone ignoring the collapse in sales force productivity? is it a sign of saturation or competitive pressure or both? i know analysts can answer it and rebut it. >> we don't have a collapse in sales force productivity. we have a great sales force that's doing a fantastic job. the net additions in the last quarter were a little slower. look at the trend. we actually continue to build out our network and look forward

to actually having virtually every one of the restaurants in our tam will have an electronic version versus pen and paper. it's just a better way to run the business. >> you have to follow up. in the first quarter, open added 2.7 restaurants per employee, again, pa research, which would represent the lowest level productive generated by the company sales force. is that true? >> we don't calculate it or provide a specific or 2.7 versus our typical reps. i don't think that calculation is accurate. the reality is, we actually have a higher level of attrition. restaurants typically, that would be a bigger added business quarter for restaurants than say the 4th quarter, during the holiday season. there is no trend on the first quarter at all. we look forward to robust additions going forward. >> i think people at home, wait a second, why are restaurants willing to give you all those revenue streams?

what do they really gain from open table? >> they gain a lot of insights into their business and the ability to delight diners with better hospitality. our ultimate vision is to enable a different differentiated dining experience. when you use open table, we can actually provide a better experience than if you pick up the phone. our restaurants will have more insights into your preferences, like you are gluten free, you like a booth versus a table. those insights allow for a better experience. that's really a value proposition that rings true for our restaurant customers. we also, as you pointed out at the top of the show, we actually provide an amazing roi. when a restaurant seat goes empty, it's just lost profit. it's lost opportunity because it's a high fixed cost business. >> the last thing danny meyer told me also, that the number of people who don't want to cancel reservation by phone and just don't show is incredibly high because they're embarrassed, but at open table, people actually

do cancel so you get that table back. >> that's right. we make it very easy for people, if their plans change or they're not able to fulfill their reservation to cancel. actually, with our mobile devices, it's getting easier for that. that's a real value for restaurants, because a last minute cancellation or actually a no show is really bad. that seat could have been filled by somebody else. >> i just need to ask your advice on this. i mean, there are people who football the stocks so to speak. i mean, they get as p.a. research is saying, missed your own guidance, how could this possibly have happened? again, i don't think the guidance was necessarily missed. but i do need the answer to that so i don't feel i'm being too glib about the situation at open table. >> i think overall, our guidance, we met expectations, both internally and externally. last quarter we had a slight foreign exchange impact, which we can't control foreign

exchange rates. dollar strengthened. that slightly suppressed our international revenue by about $300,000. so we're very comfortable and confident in our outlook going forward. >> thank you, terrific. thank you, matt roberts, ceo of open table. i myself am a constant customer. good to seee you, sir. >> thank you, jim. >> you want to check all the research. i asked some tough questions for research that doesn't believe open table is doing well. i feel those metrics are all going in the right direction. matt roberts, president and ceo, open table, open. stay with cramer.

[ music playing ] it is time! it's time for the lightning round. we hear this sound. then the lightning round is over. are you ready? it's time for the lightning round. i want to go to greg in nevada. greg! >> caller: hey, jim, boo-yah from reno, nevada. >> boo-yah, chief, what's going on? >> caller: i'm thankful for all the great education you give me on your show.

>> thank you. >> caller: i want to know about suntrust. >> oh, stephanie link, buy, buy, buy. it's drives us crazy. that stock is punching through to 33. 10% gain ahead. i need to go to stan in florida. >> caller: jim, boo-yah from lakeland, florida. i got a spec stock. it's process energy. >> i don't think that's spec. as a matter of fact, i like it. buy, buy, buy. it's can go higher to catch up with the others because it's got a good yield. let's go to john in maryland. john. >> caller: boo-yah, mr. cramer. >> yo-yo. >> i'm looking at teva pharmaceutical. >> no, that is a don't buy, it's been a real disappointments with a drug rolling over eventually. it will go off patent. eric in massachusetts. >> caller: eric from boston. boo-yah, to you, jim.

my stock is arm holdings. >> it just went up 10 points in the stocks rally. let it come down then buy, buy, buy, buy. you know i was right intel, i said it, i was right. let go to ken in michigan. ken. >> caller: a big, bbbbb boo-yah. >> i love that stuttering boo-yah. i have always been a spartan fan. it was the name of my high school team. >> caller: cramer, my stock is biogen. >> biogen is coming back. i think it will go to 200. people will say it's head and shoulders. i don't care. joe in connecticut. joe. >> caller: a big boo-yah to you from connecticut, mr. cramer. >> nice. >> caller: the stock i want to ask you about is nokia. >> the other day i saw that amd is up gigantically.

i think 55 can go to 45. lisa in missouri. >> caller: hi, i want to tell you, your staff is so nice. >> they're the greatest. >> caller: and my question is about mdlz, mondeliz. >> not a great quarter. going to dan in florida. >> caller: hello, dr. cramer. >> i know, i got that degree. what is going on? >> caller: all right. how are you? >> how are you. >> caller: pretty good. hey, i was calling about first energy. what do you think about that? >> i think it's a low quality utility. that's okay. it yields 5%. now i like aep better, though, that, ladies and gentlemen, is the conclusion of the lightning round. coming up, blueprint to a buy. breakups have been big news, we're not talking romance.

it's the company spin-offs that have been a win on wall street. tonight, cramer breaks down how to find the next candidate that can help you cash in. i spent at lot of time

we're always pushing for breakups. one of the best catalysts. i spent at lot of time telling you how this works theoretically. some businesses don't belong under the same roof. you split them up, create smaller pure plays. meanwhile, the simplified broken up companies are much more appealing to the wall street fashion shows, the mutual funds, in particular. money managers would rather own an easy to understand pure play than a complicated conglomerate. the parts are worth more than the whole. that's the theory. by now, we recommend so many breakup stories. i want to talk to you about how

this idea works empirically, not just anecdotally. it's not that breaking up should create value. it's that breaking up does create value, something we've seen time and time again over the years in doing this show to the point where it's a tried and true formula, not a gimmick. i am constantly pushing simply because the game plan has made us so much money. sometimes it feels like all we do is talk about big name breakups. we're like the people magazine of the stock market. unlike people, we're actually trying to make you a lot of money. so tonight, i wanted to tell you about the anchor breakup. that's why i'm calling. these are the ones that are bullish about this tactic, as long as the ones on "mad money" there are terrific gains. when you see how consistently this works, you will be surprised companies don't break themselves up more often. first there was american standard. ast.

they made heating, ventilation and air conditioning systems, champion toilets and faucets. three totally unrelated businesses, that's why in february, 1997, american standard decided to break up into three separate units. they sold the kitchen and bath unit, spun off into wabco and became train not like the group, which was sold to ingersoll rand. before the breakup, american standard had an enterprise value minus cash of 11.9 billion. kitchen business sold for 1.2 billion. trainegot sold. in other words, you basically got wabco for free. it has an enterprise value of 4.4 billion. american standard unlocked 36% gain almost instantly. okay. wow!

12 months after the breakup, pretty good. the second anchor breakup. tyco, tyc. at the beginning of 2006, tyco told us it was splitting into three separate companies. tyco spun off its healthcare business, covidien. the american flow control business with pent air and keeping the security business as a part of the subcompany, before the breakup announcement, tyco was 68 billion. it's all worth 17 billion of value creation simply by splitting the company up. how about altria? they are spinning off kraft. in january the next year, they announced a huge breakup,

splitting the domestic tobacco business to philip morris. in 2011, kraft spun off out of altria decided to spin into a company still named kraft and a snacks company mondelez. altria 181 billion. today, philip morris international alone is worth that much. $174 billion. mondelez and kraft, 109 billion. altria has more than doubled before the first spinoff was announced. that's where the s&p was just up 14%. oh, and that 100%-plus gain doesn't include the bountiful returns you get over the years, because they all pay hefty dividends. wow. those are the big three anchor breakups. what about the breakups here on mad money? marathon oil said it was breaking up into an oil and gas

and refinery company. a few years later, marathon and conoco philips as a company i thought could follow in marathon's footsteps. marathon gave you a 30% gain between the announcement and when the breakup happened in 2011. how about this conoco? finally broke up in may, 2012. since then, conoco phillips are up. i think occidental, oxy could be next, which is why my charitable trust has been aggressive when it went down to the low- to mid-'80s. i bet you can get an advance similar to conoco if they would bring out the cleaver. how about this covidien, it was

spinning off its pharma business, doing substantially better than the s&p over the same time frame. covidien will trade under mnk. healthcare got behind abbott labs, a national breakup in 2011. at the time the company had 95 million. breakup finally occurred this january. now abbott labs worth 141 billion. 46 billion just by announcing the company is splitting. there is fortune brands, split into beans, the home and security for faucets, and locks. i recommended it when it happened. it is up 42%. i recommended fortune brand securities two months later, a 126% gain.

october, 2012, i said buy news corp. they announced the stock did very well today. they got behind it as a breakup play. ahead of the market, after wall corps, a 70% gain, much better than the s&p gain of 20%. last may, dean foods, because i thought they could make a bundle taking their natural and organic business public. that's what they did. 34% gain. all this because of the stroke of the pen. since then, it's announced a major assets sales, 34% gain. 13% gain for the s&p. here's the bottom line. now when i tell you i like this, after the potential breakup. you know i'm not blowing hot air. they have all these examples illustrate, breaking up is a

terrific way for many companies to create value for you, the shareholders. all they got to do is split them up. look at that value creation. after the break, i'll make you more money. arigato! we are outta here! finding you the perfect place. hotels.com.

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can the rally in groupon possibly be for real? how about yelp?

these companies have been at the heart of what to buy, where to eat, where to stay. they hit a remarkable resurgence because of mobile and the pickup of the local commerce. groupon and yelp have managed to harness the rise of the mobile app versus the desktop and the return of the growth to the american consumer. now, i don't want to get carried away here, groupon is a sizable international business in terrible decline and there are real issues about whether they are making money at all. the company with cash flow negatives, meanwhile, overnight, yelp has become one of the most overpriced stocks in the book. there are no real earnings. however, the core business metrics like more couponing for coupons and the more reviews are headed in the right direction. many people thought they may not make it. it was premature. yelp has a pulse.

it has accelerating revenue growth. we call that arg, which remains the holy grail. most of the internet companies i follow, indeed, most of the tech companies i follow have been hurt or almost annihilated by migration from desktop to hand-held devices. uniquely, these companies develop. i can't tell you how many times groupon used the word local. local use accounts for 45% of groupon's business. that conversion explains the bountiful business they are doing in north america. groupon made sure that everyone who listened to the call heard local business experience and solid sequential growth because and i quote we are a local company. yelp came on with real serious statistics about businesses that reached outsize gains, 8,000 by claiming a free business owner

account and a 23,000 gain if you advertise, even better, the local usefulness explains how 36 percent of the company's users found businesses via their app, up from 25% a year ago. that's how you get local revenues up. these are remarkable numbers. they're a testament how yelp is suited to the mobile model. more importantly, i believe neither company could be doing as well as these numbers indicate if the american consumers go out more, shop more frequently. that gives these two companies secular and consumer growth and cyclical growth. which are the real reason behind the resurgence in stocks. i can see why people might be willing to pay single digits for the company. in the end, it still doesn't make money. management, though, has clearly helped the cause.

yelp could break out rather quickly. the market cap gives little room for growth. so it, too, might not have that much upside. bottom line, they are hot at least for the moment because of their mobile qualities. given the non-google non-yahoo internet stocks, nothing is sure and nothing can ever be taken for granted. stay with cramer.

>> too much froth the market has to cool down for my taste. this is "mad money." i'm jim cramer. i will see you tomorrow! it's all hands on deck... this is hurtin' me, bubba. i've gotta act fast... now we gotta make money, 'cause so far we're in the hole. or we'll be coming home empty-handed. >> tell jeff to lift the reserve. let me sell the car. let me sell the automobile. my name is jeff allen. i buy, fix, and flip cars.