Jim Cramer on HP

To say that Hewlett-Packard (HPQ) has lost its way is an understatement, said Jim Cramer. As other competitors grow, the $120 billion company is falling behind in the hardware and consulting space, lacking significant mobile, social and cloud strategies.

"You have a company that's kind of been left out and I don't where the turns going to come from. It's not going to come from just printers," Cramer said.

HP continues to lose out to competitors in the hardware space. Apple (AAPL) passed Hewlett Packard as the largest hardware seller, and Cramer said the tablet has turned out to be a category that's more important than ultra-book. Though HP spent a billion on Palm, for its operating system, it has not lead to a phone. In addition, Cramer thinks the public has soured on HP's printers.

HP, he said, had been making some inroads on the consulting side but he thinks that could be rolled back.

Despite the recent rally in the stock market, HP has continued to drift down and Cramer thinks the company is in serious trouble. Though HP's bonds are holding up, he wouldn't want to hold them either. He prefers Accenture, IBM, and SAP, which stand to benefit as they pick off pieces of the business.

"This is tech. This is not General Mills. It's not Kellogg. Get a new CEO in there and they are not going to be able to reinvent the syrup. Hewlett Packard is falling behind. And the others are spending a lot more," Cramer said. "Here, I think of SAP, Accenture. To a lesser extent Dell. And certainly IBM on the consulting side."

At the time of publication, Cramer was long XXX.