He doubled down on his belief that there is substantial upside in the stock price, thanks to activist investor Elliott Management's position in the teleco giant.
"If AT&T were trading in the $40s or even the mid-$50s, where Elliott believes it can go if the company hits its long-term targets, then the stock would be a sell here," the "Mad Money" host said. "But at $38, AT&T's already trading like those estimates are unlikely. And, hey, if management can deliver, I see this stock going much, much higher."
Cramer was responding to a thesis put forth by MoffettNathanson's Craig Moffett, one of two analysts with sell ratings, according to FactSet. The firm in November downgraded the stock from neutral, assessing a "cloudier" path to meet its 2020 and three-year guidance. AT&T's wireless business would need substantial growth in order to offset weakness elsewhere, Moffett said.
AT&T's revenue is estimated to reach $182.8 billion in 2022, about 7% higher than the $170.8 billion it recorded in 2018, according to FactSet.
"Even if he's right that it's borderline impossible for AT&T to hit its forecasts for 2022, I don't think any of the bulls are really banking on those numbers," Cramer said. "This is a forced turnaround play, meaning Elliott Management is forcing AT&T to get its act together."
Conceding to Elliott Management's demands, AT&T in October agreed to add two new members to its board, pay off debt from the acquisition of Time Warner and sell off as much as $10 billion of its non-core business assets next year.
Admitting that investors should be skeptical about the company's targets, Cramer said the activist firm is "holding AT&T's feet to the fire" after "over a decade of complacency.
AT&T could benefit from the roll out of the fifth-generation of wireless technology, known as 5G, and an iPhone upgrade cycle over the next two years, the host said.
"Put it all together, I think Moffett's missing the forest for the trees with this sell recommendation," Cramer said. "If the company can't make real progress toward its long-term guidance, I have to believe Elliott will come down on them like a ton of bricks and bring in a new team."
AT&T shares dropped more than 4% the day Moffett, who has a $30 price target, made the sell call. The stock has since recovered those losses and is up more than 33% on the year.
The stock closed Monday's session down 0.42% to $38.04.
"If you buy the stock here, you're betting that the company has a lot of room to improve with more focused leadership," Cramer said.