Why Jim Cramer Says Investors Must Own Facebook (FB) Stock

NEW YORK (TheStreet) -- TheStreet's Jim Cramer says Facebook  (FB) has run for a while, so people may ask why it is not up even more. He notes the social media giant is generating a huge amount of cash and is an earnings-per-share story.

Cramer thinks the stock could earn $3 in 2016 and deserves a 30 multiple with 50% longer-term growth during that period, which would lift the stock price to $90. So Cramer says investors need to buy Facebook even if the stock does come back down a bit. He believes Facebook will become a core holding for money managers, not unlike Google  (GOOGL) or Apple  (AAPL).

Cramer says Facebook is not a revenue story or a fly-by-night outfit. It's a cash machine with very good leverage and great operating margins, and he encourages investors to buy it.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

FB Chart FB data by YCharts

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet's Jim Cramer shares his thoughts on Facebook's latest quarter:


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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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