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NEW YORK ( TheStreet) -- Investing is about making money, not about having the best investment strategy, Jim Cramer told his "Mad Money" TV show viewers Monday as he commented on a recent tweet he received regarding Amazon.com (AMZN).
The question was whether Cramer would recommend buying Amazon or whether the stock was overvalued. His answer? Yes on both counts.
Cramer explained that by any traditional metric shares of the ecommerce giant are wildly expensive, but that doesn't mean the stock shouldn't be bought. That may found counterintuitive, Cramer admitted, but to growth fund managers it's not about paying what a stock is worth today, it's about determining what a stock will be worth years down the road.Amazon's mission of delivering more and more items at great prices to your door will remain intact for years to come, said Cramer. This was evidenced by today's news story depicting how Amazon experimented with unmanned aerial drones that could one day literally drop-ship items weighing five pounds or less right to your driveway. That kind of innovation and continued industry dominance is why investors are willing to pay $400 a share for Amazon, not the company's current P/E ratio,said Cramer. Amazon's valuation is only eclipsed by other "cult stocks" including Tesla Motors (TSLA) and Solar City (SCTY), two companies run by another visionary, Elon Musk. Cramer said with Wal-Mart (WMT) and Target (TGT) both reporting stale earnings, it's only natural to think Amazon will be having a great holiday quarter. But that's not the reason to buy shares of Amazon, he continued -- it's to follow the money managers who are looking for growth and are counting on shares of Amazon being worth substantially more in years to come. After all, stocks are worth what people are willing to pay for them, Cramer concluded, and in the case of these growth names, they're just not bound by traditional metrics.