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Buy Alphabet Stock Right Here, Jim Cramer Says

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Jim Cramer says that because Google parent Alphabet (GOOG)  , (GOOGL)  is now the cheapest of the FAANG stocks when measured against its growth rate, it's one of his "5 Great Stocks for a Volatile Market."

"I'd buy that right here -- right here," Cramer said during his latest video-conference call with members of his Action Alerts PLUS club for investors.

Cramer, who coined the now-famous acronym "FAANG" to describe some of the market's most popular tech stocks -- Facebook (FB) , Amazon (AMZN) , Apple (AAPL)  , Netflix (NFLX) and Google (since renamed Alphabet), noted that GOOGL recently announced the best quarterly results among the group.

He also said it's the least controversial of the FAANGs at a time when critics are taking aim at Facebook for consumer-privacy issues, Apple for its Chinese manufacturing and Amazon for crushing local bricks-and-mortar retail.

Other positives that Cramer sees:

  • The Web's Dominant Search Engine. Alphabet's Google search engine "is getting stronger [and] is part of all major ad buys for consumer products, because you want the ad to appear right where the product is looked up," he said. "It's a must-buy when it comes to advertising on the Internet."
  • YouTube. The company is benefiting from consumer "cord-cutting" of traditional cable-TV services in favor of online video-streaming services. Cramer said that's great news for Alphabet-owned YouTube. "Do you know that [YouTube] has 2 billion monthly user? Do you know that the number of channels with over a million subscribers grew 75% last year alone?" he asked. "Nobody talks about that."
  • A Growing Cloud-Computing Business. The expert said that Google Cloud is also gaining traction thanks to the new leadership from Thomas Kurian, the former president of Oracle (ORCL) . While Google Cloud is still well behind market leader Amazon Web Services and Azure from Microsoft (MSFT) , Cramer said that business clients are looking for more than one cloud provider.
  • Little Trade-War Risk. GOOGL has "no exposure whatsoever to China, although someone was trying to link them recently -- [but] I mean, please, that's attenuated," he said. "They do have [exposure to] Europe, but Europe was quite good for Alphabet." 

And despite such question marks as long-shot businesses like the Waymo self-driving car unit, Cramer said that "I just care about the basics. Alphabet is now the cheapest FAANG on its growth rate, and that's what matters."

Cramer said that's why his charitable trust didn't sell any of its Alphabet stock during in the recent FAANG selloff. "At 23x earnings, a perfect balance sheet brimming with $120 billion in cash [and a] 17.5% growth rate, we couldn't justify it."

Want to See Jim's 4 Other Picks for Today's Volatile Market?

Cramer unveiled his Five Great Stocks for a Volatile Market video-conference call was only available to members of Cramer's Action Alerts PLUS club for investors, but you can sign up for a free 14-day trial membership and listen to a full replay.

Club membership includes exclusive access to Cramer's private video-conference calls each month, and also includes lots of other benefits, including:

  • A complete rundown of all of stocks that Cramer holds his charitable trust;
  • E-mail alerts that give you a chance to buy or sell any stock before he makes a trade for the trust;
  • Custom research throughout each trading day from Cramer and his team of stock-market analysts. You'll get to see some of the same research that Cramer sees every market day as he and his team make investment decisions.

Click here to join Action Alerts PLUS today!

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