Jim Cramer -- Here's Why We Hold Starbucks and Facebook

Jim Cramer and Jack Mohr explain their rationale for some of their growth-stock picks, including Starbucks and Facebook.

Author:: Bret Kenwell
Publish date:: May 17, 2016 3:23 PM EDT

Everyone loves growth. So do Action Alerts PLUS Portfolio Manager Jim Cramer and Research Director Jack Mohr, who explained why they pick certain stocks in a recent subscribers-only conference call.

One of Cramer's growth-stock picks is Starbucks (SBUX) - Get Report , which rebounded after slipping more than 7% in April after reporting earnings. This lowered the stock's valuation, but Cramer says that given the company's long-term projection of near-20% earnings per share growth, Starbucks stock is now more attractive.

Also on AAP's growth list is Facebook (FB) - Get Report . The company reported blowout earnings, which sent the stock to new all-time highs. The company boasts 1.5 billion users and has steady, high growth for earnings and sales, Mohr says.

So is it time to sell? Cramer acknowledged the stock is more than susceptible to a pullback -- as are other higher-valuation stocks -- but he is sticking with the social media juggernaut, as he has for several years. He said it's always tempting to take profits in Facebook. It was tempting at $30, $50, $75, $100 and now near $120.

Cramer said if he didn't already own the stock, it would be prudent to wait for a pullback before getting long. But he said the stock is relatively cheap based on a longer-term time horizon. For instance, the company could earn $7 per share in 2018, making the stock not so expensive.

Facebook trades with a price/earnings to growth ratio of just 0.9, which is relatively low for the stock market let alone the tech sector, Mohr adds.

Alphabet (GOOGL) - Get Report and Visa (V) - Get Report are also on Cramer and Mohr's radar.