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NEW YORK ( TheStreet) -- In the technology world, relevance matters, Jim Cramer said on Mad Money Monday. Nowhere is that more evident than in the earnings of Apple (AAPL) and IBM (IBM) , both of which reported today.
Cramer said that Apple, a stock he owns for his charitable trust, Action Alerts PLUS, is a perennial innovator, a cheap growth stock that shouldn't be traded but owned for the long term. It's no wonder shares of Apple are up 26% for the year.
But then there's IBM, an expensive stock with no innovation or growth at all, said Cramer. This stock deserved to fall 7% on its earnings news.Cramer said IBM is simply no longer an important name in the tech world. The only bright spot in the company's earnings was IBM's newly forged partnership with Apple and its stock buyback program. IBM needs a plan, Cramer said, a bold acquisition to once again make itself relevant. With so many businesses leaving IBM's legacy platforms in favor of the cloud, he only hopes the company has the time and the funds make it happen.
Dethroning King DigitalSometimes a hideous initial public offering is just the beginning, Cramer warned viewers. That has certainly been the case with King Digital Entertainment (KING) , makers of the popular mobile game Candy Crush. After falling 15% below its IPO price back on March 25, King Digital has only seen its shares continue to falter, down 40% for the year to just over $11 a share. Cramer said the initial analyst recommendations of King were overwhelmingly positive. Unfortunately, they were also overwhelmingly wrong. The logic at the time was that King was a much better stock than Zynga (ZNGA) , the last mobile gaming company to crash and burn in the stock market. King was indeed cheaper than Zynga, with better earnings and growth. But calling a stock better than one of the worst stocks of all time is not a reason to buy, Cramer concluded. Growth is slowing significantly at King, Cramer noted, and it appears that Candy Crush may indeed be a one-hit wonder. Making matters worse, a full 80% of King's shares are still in an extended lockup period. Cramer said when that lockup expires there could be another flood of selling as insiders try and salvage whatever value may be left in their shares. Must Read: Apple Blows Past Estimates on Huge iPhone Sales, Upbeat Holiday Forecast
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