Cramer: IBM valued higher than Apple—Insanity!

Jim Cramer saw a big change in market perspective this week. The shift occurred so dramatically that it prompted investors to suddenly love stocks that they hated just a few short weeks ago — such as IBM.

"This is a market that has disdained low valued stocks. Its mantra has been, sure they're cheap, but so what? However, the market is not saying that anymore," the "Mad Money" host said.

For instance, airline stocks have been selling at price to earnings multiples that are equivalent of approximately half the value of the average stock. And it seemed to Cramer that investors are willing to overlook negatives such as the Zika virus and the strong dollar, now that it is possible that oil could stay lower for longer.

A man walks outside the Apple store on the Fifth Avenue in New York on February 17, 2016.
Kena Betancur | AFP | Getty Images
A man walks outside the Apple store on the Fifth Avenue in New York on February 17, 2016.
"That is insane. In no universe should IBM be getting a higher multiple than Apple." -Jim Cramer

Cramer also found value plays with industrials such as Cummins and Emerson, as both seemed to have hit a bottom in orders but are starting to talk about a return to growth with a juicy yield at 4 percent.

The one value play that was front and center on Cramer's radar was Apple at $97, where it trades at just 10 times earnings.

Apple just announced a $12 billion bond deal, which will provide it with capital to buy back stock. At the same time, its Apple pay feature just went live in China where electronic payment is more prevalent than in the U.S.

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Cramer added that he knows most investors have only been focused on the difficult position CEO Tim Cook found himself recently regarding the request from the FBI, and he believes that ultimately the courts will decide the outcome.

"But you don't need a court to remember that Apple is now getting $30 billion in service sales a year. That is the revenue stream that so many want Apple to have. They have it!" Cramer said.

IBM was upgraded by Morgan Stanley on Thursday, which prompted the stock to soar more than 5 percent. And with investors worried about the current quarter's iPhone sales for Apple, IBM is now valued higher than Apple.

"That is insane. In no universe should IBM be getting a higher multiple than Apple," Cramer said. (Tweet This)

In Cramer's perspective, there is no other company that he follows that has been hurt more from the strong dollar than IBM. Therefore, if IBM can rally that much on an upgrade, he wondered what could happen if the same happened to Apple?

As a result, value stocks have made a comeback in the current market environment. Cramer saw a sense of urgency in investors looking for cheap stocks that was not there before.

"That is what may be happening in this market that suddenly craves what it hated just a few short weeks ago," Cramer said.

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