CNBC's Jim Cramer said Tuesday young investors believe Tesla CEO Elon Musk has grand visions for the electric-vehicle maker that make him comparable to late Apple co-founder Steve Jobs. That's why they're willing to continue buying Tesla's stock, helping propel its dizzying run this year, Cramer added.
The remarks followed news of Tesla's plan to raise up to $5 billion in a share offering for the second time in about three months. While its stock was down about 2% Tuesday, Cramer said Tesla's capital raise may speak to what youthful investors like about Musk.
"It's entirely possible that they're using it for things that we don't know that he has planned. That's the greatness of this man," Cramer said on "Squawk on the Street." "That's why this younger generation is willing to give him money. They are saying, 'Look. He's Steve Jobs. Who knows what he comes up with next. I want a share of it.'"
Tesla's decision to raise money also is sensible when strictly evaluating the company's known endeavors such as the factory it's building in Germany and its electric pickup known as the Cybertruck, Cramer said. "I think you're going to need every penny to make it so that you have the best cars in the world," he said. "To do the pickup truck ... is going to cost a lot of money. You're up against some very serious companies when it comes to pickups, and that's where the money is."
Shares of Tesla have soared to great heights this year, rising well over 600% to a series of record highs. The company also earned inclusion into the S&P 500 this fall after posting its fourth straight quarter of profits in July. Tesla will be added to the benchmark U.S. equity index before the open Dec. 21.
Cramer, who had been critical of Musk and Tesla, began to turn bullish on the company late last year. The "Mad Money" host declared on Dec. 11, 2019, that he was a "true believer." Since its close that day, Tesla's stock is up almost 800%.
Cramer also has touted Tesla's work on solar panels, contending the growth potential of its business in that category is underappreciated. "He's got this whole thing going on with solar and with energy that we don't talk about enough," Cramer said of Musk on July 23. Musk also serves as chief executive of SpaceX.
While some people have been bewildered by Tesla's astounding rise, Cramer said Tuesday that younger investors' faith in Musk should be respected. "Who are we to criticize ... their wonderment? Who are we to criticize their belief in this man?" he said.