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NEW YORK (TheStreet) -- Apple  (AAPL) stock is advancing 1.40% to $109.18 in early-afternoon trading on Wednesday, following a ratings upgrade to "outperform" from "market perform" and price target hike to $135 from $125 at Cowen & Co

Year-over-year comparable sales and forward earnings estimates have bottomed, Cowen & Co. wrote in a note, while expressing optimism about the company's iPhone 7 launch this fall.

"I believe in the iPhone 7, I believe in what Tim Cook is doing," TheStreet's Jim Cramer said on CNBC's "Squawk on the Street" this morning.

Additionally, shares of the iPhone maker are trading at a 25% and 30% discount to its large-cap competitors and the S&P 500 index, respectively, Cowen & Co. continued. 

Cramer similarly contended that, even though the Apple Watch might not be the greatest and the iPhone 7 could potentially be waterproof, "the most important thing is the stock is so darn cheap."

Given that the stock is expected to trade at eight times earnings in 2018 and has a strong balance sheet, shares of Apple are "hard to dislike," he mentioned. 

Apple's service revenue, which represents 14% of its business, could double, Cramer said. He urged the company to emphasize the notion that Apple is not merely a one product company, since customers must pay an Apple bill every month after they've purchased certain items.

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Also boosting shares, the dollar has weakened following the Federal Reserve's bearish comments yesterday, which will benefit Apple as the company is "heavily weighted" to a weaker dollar, Cramer pointed out.

"Here we are at $107, $108 and now everyone wants to get in," Cramer states in the above video. "Why? Because year-over-year comparisons if the dollar stays weak are going to be very good."

(Apple is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holdings here.)

Separately, TheStreet Ratings team rates the stock as a "buy" with a ratings score of B.

Apple's strengths such as its revenue growth, notable return on equity, expanding profit margins, increase in net income and growth in earnings per share outweigh the fact that the company shows weak operating cash flow.

You can view the full analysis from the report here: AAPL

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author. 

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