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Conventional analysis won't work here: Cramer

At any given moment there are always a couple of stocks that defy traditional expectations," Cramer said.

Right now, Cramer believes that's Tesla and Netflix.

"That is, Telsa is up 454% year to date," Cramer explained. "The company has a market cap of $22 billion, yet it will be lucky to sell 22,000 cars this year. By comparison, GM sold 9 million cars – more than 100 times Tesla, yet its market cap is $51 billion, a little more than two times Tesla.

Conventional analysis would suggest Telsa shares are ahead of themselves; that a decline is imminent. But, in this case, that kind of common sense conclusion would probably end up generating losses.

That's because "People love Tesla's cars," Cramer said. They absolutely love them. And when customers have such an emotional response to a product, the company's valuation can defy conventional analysis.

On the Street pros would say, "Tesla has momentum," Cramer explained. And as long as a company's growth potential combined with customer enthusiasm for its products remains strong, the Street will likely reward the stock with a very high multiple.

Therefore, despite the sky high valuation, Cramer believes the path of least resistance remains higher.

Tuonas Kujansuu | E+ | Getty Images

The Mad Money host said that Netlfix is a similar story.

Netflix is up about 250% ytd and, depending on the metrics, trades at over 400 times earnings. Again conventional wisdom suggests the stock is ahead of itself.

But people love Netflix, they love their proprietary shows such as House of Cards or Orange is the New Black.

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Therefore Cramer concludes that even though valuations may not make a lot of sense on paper, Netflix should also keep going higher.

"At some point this game ends," Cramer added. "At some points valuations will matter." But not yet.

Call Cramer: 1-800-743-CNBC

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