Although many metrics are used to measure the value of a company, Cramer said special attention should be paid to its future prospects. After all, that's why investors are willing to pay more for growing companies with strong future prospects, even though they may seem more expensive than their slow-growing peers.
Take Pfizer and Celgene , for example. The former is currently selling for 8.6 times next year's earnings while Celgene sells for 14.5 times earnings. Pfizer may appear cheaper, but Cramer said it only has a lower multiple. While Pfizer yields 4 percent and has a big buyback, Cramer said it lacks growth and that means you can't justify paying up for this stock.
"That's why when we're playing in pharmaceuticals, I'd prefer to go with a fast growing biotech firm like Celgene," Cramer said. "While Celgene has a higher multiple than Pfizer — selling for 14.5 times earnings — it also has a much higher growth rate, which is why this stock is the cheaper of the two."
Considering its 25 percent long-term growth rate, Cramer said Celgene may be the least expensive growth stock that he follows right now.