Shares of the cloud-based data storage company closed up over 35 percent after its first day of trading, at $28.48 a share, well above the company's stated price of $21.
"If you were paying attention over the course of the session, you know that this was a white-hot deal," the "Mad Money" host said. "This is exactly the kind of stock that Wall Street wants right now."
Dropbox, a cloud-based data storage company that lets users access their online files anytime and from anywhere, was founded in 2007 as a simple online storage play.
Since then, it's grown into what Cramer called a "digital collaboration platform," reducing the time users spend searching for files, managing workflows and switching between applications.
One of Cramer's favorite things about Dropbox is that its platform basically sells itself. The company gives away free versions of its product to users, only asking them to pay up for the full capabilities after they've filled up a certain amount of storage space.
Dropbox has said that 300 million of its 500 million non-paying registered users have similar characteristics to its paid subscribers — a huge growth opportunity, Cramer said.
Cramer was also impressed by the company's numbers. In 2017, Dropbox had 31 percent revenue growth, in line with most other public cloud companies. Its gross margin, or what it makes after the cost of goods sold, exploded from 32.5 percent in 2015 to 66.7 percent in 2017.
"The balance sheet? Clean as a whistle," the "Mad Money" host said. "The company's using the proceeds of the IPO to pay back its modest amount of debt, and it already [had] $430 million in cash on the balance sheet at the end of last year. Given that they just raised anywhere from $600 [million] to $750 million, Dropbox is going to have a pretty deep pocket for a newly public company."
Cramer's main point of concern was whether Dropbox would be able to keep turning its non-paying subscribers into paying customers. To maintain its growth rate, it needs to switch between two million and four million free users into paying customers each year.
But that's less than 1 percent of its 500 million free subscribers, Cramer noted, adding that the company will now have millions of dollars to invest in and bolster the business.
"Put it all together and I'm a big fan of Dropbox the company and its CEO, Drew Houston," he said. "But what about Dropbox the stock?"
Trading at 8.5 times next year's sales estimates and 124 times 2019 earnings estimates, Dropbox's stock may seem expensive, but is more or less in line with the other "cloud kings," Cramer said.
"You have to ask yourself, does it deserve to trade like a cloud king? I think so," he continued. "Dropbox is cheaper than Adobe, but it's growing faster than Adobe. Ideally, I'd like to wait for pullback before telling you to pull the trigger, but you know what? I'm not sure you're going to get one."
So as Dropbox shares settle, Cramer said any cloud-hungry investors should keep an eye on the newest public player in the space.
"Look, you need to be careful with these red-hot IPOs. That said, I absolutely feel comfortable giving you my blessing to speculate on Dropbox," the "Mad Money" host said. "There aren't that many first-class cloud plays out there, and the group will only become more attractive if people keep freaking out about a trade war with China ... because this is the kind of secular growth theme that keeps working even if the economy slows down. I say put on part of your position and then hope the stock of this incredibly well-run company gets slammed so you can buy more later and lower."