How has this company managed to thrive in this market?...

The company traditionally been involved in selling ingredient nuts... that's a $900 million market... very small. That's the stuff I've been using ever since I appeared on Martha Stewart's show... and learned a thing or two about cooking... alright, not really... I was just fixing broken chairs...

DMND's move into selling branded healthy nut snacks... that is a much bigger market... we used to call them "addressable markets"... that's what we call them on Wall Street... It's a $2.9 billion market, and much bigger than just for cooking.

DMND took nuts - a boring snack food I have to admit, if there ever was one - and breathed new life into it, and with sexier packaging, new brands like Emerald, adding new flavors, and unleashed new advertisements. DMND is trying to take share from Planters by going after the younger cohort, as people 25-34 say they prefer Emerald nuts to Planters by a 2 to 1 margin. We'll have to ask him... maybe that's because I always associate Planters with a huge amount of salt... The younger generation, by the way, has no respect for Mr. Peanut... the dandy with the monacle and the cape... they should retire that guy already.

DMND still has a lot of room to take share... It's only got 6% of the grocery nuts market, compared to 40% for Planters, 30% for private label nuts. DMND's expanding its distribution and thinks the snack business can grow to between $200 to 250 million by 2011, compared to the $90 million analysts expect it to bring in this year. Don't trust most sell side stuff... they don't know the actual numbers.

DMND also bought "Pop Secret"... That was the #2 popcorn brand... from GIS, a stock that we've been recommending endlessly on Mad Money, and a stock that I own for MCT... They say the deal's additive, and we're going to ask about that.

DMND beat when it reported its most recent quarter... how many have done that... delivering 16 cents of earnings per share, when the Street was only looking for 13 cents. That's a huge beat, more than tripling its earnings, compared to this quarter last year. Again, amazing...

But we have to wonder... I mean, come on... that is real momentum...

How long can that momentum last in this environment? Should we take our profits, declare victory?... That's been a smart strategy overall this year... Or can this one keep going higher?

It takes a nut to know a nut... But even this nut needs some help... which is why I've got Michael Mendes, the CEO of Diamond Foods, Inc. (DMND), right here in the studio with me. This guy's a winner. Welcome to Mad Money...

Jim's comments AFTER the interview:     This one is working in a very tough environment. Terrific.