Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
NEW YORK ( TheStreet) -- Before you sell your stocks on the latest round of euro-fears, think about News Corp ( NWSA), Jim Cramer told his "Mad Money" viewers Tuesday. He said just the rumor the media giant might be breaking itself in two proves just how undervalued stocks have become. If News Corp does indeed follow up on the rumors and split its fast-growing entertainment division from its non-growing publishing business, Cramer said shares could be worth up to $28. That's proof positive the markets aren't even looking at the fundamentals of the underlying companies anymore, he said. The split makes total sense, noted Cramer, as News Corp's film and cable divisions are growing a 8% and 15%, while its news and magazine divisions are shrinking by 24% and 19%. That means that growth fund managers can pile into the entertainment division at lofty valuations while more conservative investors can stick with the lower valuations of the news division. But News Corp is symbolic of a larger problem, said Cramer, as company after company is realizing just how poorly the markets are valuing their stocks and are doing something about it. Kraft ( KFT), Sara Lee ( SLE), ConocoPhillips ( COP) and Marathon Oil ( MRO) have already announced breakup plans, and many more companies could follow suit. So before investors sell their stocks based on the next Spanish bond auction or bailout plan, Cramer told them to think about these names and think about how much value there really is underneath that beaten down share price.