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What's Not to Like About FUN?

Jim Cramer

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Not all businesses are created equally. Some are simply better than others. That's what I kept thinking about Monday night on "Mad Money" after I interviewed Matt Ouimet, the CEO of Cedar Fair FUN -- with that fabulous ticker symbol, FUN. Shares of this company, with a 5.85% dividend yield, have already advanced 27% this year. I think it has a lot more upside to come, as well, simply because the business is routinely underestimated by all involved.

It shouldn't be. The business is just too great for anyone to ignore the stock here.

Cedar Fair is one of three pure play theme parks in this country, the other two being Six Flags SIX and the newly minted SeaWorld SEAS . All of them offer above-average payout yields, but FUN has the most upside from earnings right now, simply because it's got the best and least recognized earnings power.

Shares of SeaWorld, which just came public, have already risen more than 30%. At the current price, this stock will have an appreciably lower yield than Cedar Fair, even with what could amount to a very similar growth rate. Six Flags, which up a similar 27%, is set up for a good year. But it has not put through the innovations that Cedar Fair has put in -- both in rides and in technological infrastructure -- and, again, it has a lower yield than Cedar Fair.

That's why Cedar Fair is the best house in a fantastic neighborhood.

It wasn't always like this. Theme parks used to be terrible investments. There were too many of them. They were too labor-intensive. They were too seasonal. Their balance sheets were often loaded with debt, as anyone who remembers the pre-bankruptcy Six Flags.

Now they are all very well-capitalized. Cedar Fair's the best on that score, too, and these parks have become destination vacations for the value-conscious consumer -- which, after the Great Recession, is just about everyone. Plus, the season, through aggressive promotion, has been extended from Labor Day to Halloween at almost all of the non-Southern parks in the country. That means much better cash flow.

It also helps that there's just not enough land left to develop that many more competing parks. Meanwhile, the existing mom-and-pop shops have almost all folded up shop.

Cedar Fair has defied skeptics for years. I had owned the stock when it was in the teens because my co-writer Matt Horween suggested the company was a cash machine that people simply weren't looking at correctly.

Nice score!

Anyway, despite the rally, I believe it's absurd to think that FUN, with that 5.85% yield, is done going up. I believe estimates are already too low, courtesy of what we learned Monday night in the interview. Cedar Fair had its greatest one-day opening in history -- at its Cedar Point park -- because of a new attraction, the GateKeeper, which was featured on "Good Morning America."

Numbers too low, yield too high vs. the other players -- and, yet, a better balance, sheet: What's not to like about FUN?