Cramer called Google the "fastest-growing company in the world" and the "greatest equity phenomena of the 21st century." He raised his price target based on his estimate that Google will earn $10 a share in 2006.
The average stock trades at about 18.5 times earnings and is growing at about 10%, Cramer said. Google is growing about three or four times as fast as the average stock, so Google should trade at a multiple of at least three times 18.5, Cramer added. That would put Google at $550. "No wonder it keeps going higher."
Cramer said Google is cheaper, based on 2006 earnings, than other well-known growth stocks such as Electronic Arts (ERTS), Whole Foods Market (WFMI), Yahoo! (YHOO - Get Report) and Amazon.com (AMZN - Get Report). The market loves to find stocks growing "furiously" that are selling for less than what other growth stocks are selling for, he said.Cramer said Google's success stems from its value proposition. Google allows "everybody to have every bit of information at their fingertips around the world" for free, he said, and advertisers are able to target their ads precisely. It's the "greatest value proposition," he said, adding that Google will wipe out every section of the newspaper. Cramer recommended -- if one doesn't already own Google -- purchasing one share on any pullback and buying an additional share each 20 points the stock may drop until one owns 5 shares. Google is the "fastest-growing and most lucrative company in an era where growth is hard to come by." Based on 2006 earnings, "Google is a true bargain," said Cramer, and is "not done going up." "I need you in Google," he said.