Mega-cap tech stocks have been crushed. Here's our updated view on 5 in the portfolio

Published Thu, May 12 20224:39 PM EDTUpdated Thu, May 12 20224:42 PM EDT

Mega-cap technology stocks have struggled mightily so far this year. But for long-term investors, all is not lost. Many of these companies — including Google parent Alphabet (GOOGL), Apple (AAPL) and Microsoft (MSFT) — are now trading at much more attractive valuations than six months ago. That could mean buying opportunities for some of these high-quality stocks. Here's how we're thinking about those three companies, along with Facebook parent Meta Platforms (FB) and Amazon (AMZN) during this current sell-off. Each one is currently in a technical bear market , defined as down 20% or more from its prior high. "I really, really like this stock," Jim Cramer said during Thursday's "Morning Meeting," adding that it holds his No. 1 ranking right now among these five tech giants. "We bought some [on Tuesday]. I'm interested in buying more." Among the reasons: We remain believers in Meta's ability to monetize Reels and grow the short-form video product into a full-fledged TikTok rival. We're not worried about the company's decision to slow the pace of hiring. Cramer said that based on his conversations with people inside Meta, management believes it can, for example, hire one senior software engineer instead of five junior developers while still maintaining the quality of work. This stock has plummeted this year, down 43.1%. But now it's cheap — trading at about 15 times forward earnings, considerably below its five-year average of 23.3. Cramer put the Google parent as his second-favorite mega-cap tech stock right now, and believes it may be the first one to bottom during this downturn. "This one is a buy right here," he said. Among the reasons: Cramer said his personal experience with owning a restaurant contributes to his long-term faith in Alphabet. Specifically, he said the return-on-investment he got through paying for Google advertisements was by far the best in the digital ad space. Advertising is Alphabet's largest revenue source. We think Alphabet had an excellent first quarter, even though earnings and revenue came in lighter than expected. That was largely due to a miss on YouTube advertising sales, Cramer said, and part of that weakness was concentrated in central and eastern Europe. Trading at 24.6 times forward earnings, Microsoft is the most expensive of these five stocks. That's not necessarily unwarranted. In our opinion, it also had the best quarter of the bunch . Among the reasons we like it and have recently been buying back portions of what we sold last month at higher prices: Microsoft generates a ton of cash and uses portions of it to buy back stock and pay a dividend. We've said all year long that we want to own companies that make stuff or do things at a profit, and return some of that cash back to shareholders. Microsoft checks those boxes. Its cloud computing unit, Azure, continues to grow. In its most recent quarter, Azure and other cloud services revenue jumped 46%, which was above Wall Street's estimates. Cramer and the Club's mantra on Apple has been the same for years: Own it, don't trade it. We still feel that way — even as shares of the iPhone maker have been pummeled lately to the point where it's no longer the world's most valuable company. The stock is down nearly 11% in just five days. Apple's warning in late April that revenue in its current quarter could be $4 billion to $8 billion lower because of Covid lockdowns in China probably hasn't helped the stock. But ultimately, Apple is still in a good place, and we think shares have been hurt by the broader environment. "I think that's part of an overall malaise of the stock market where we're cutting the price-to-earnings multiple of everything," Cramer said. "I think these stocks are going down on the same news over and over again," he said. We sold shares of Apple in mid-April, when the stock was around $166 per share; it's around $141 now. That sale was tough but necessary to make because the position in our portfolio had just gotten too large. Now, "we're in a position to buy Apple, when we want to buy Apple, if we want to buy Apple," Cramer said. The e-commerce and cloud computing giant has nearly lost all of its gains accumulated during the Covid pandemic, which helped accelerate the growth of its two main business segments. In some ways, it's rather remarkable to consider, but that's the market we're in right now. Despite the pullback from Covid highs, we're not buyers of Amazon here. "Amazon was disappointing. I still can't figure out what happened, how they could get that that wrong," Cramer said, referring to its most recent earnings report on April 28 and weaker-than-anticipated guidance. "So, that is in the penalty box." (Jim Cramer's Charitable Trust is long FB, GOOGL, MSFT, AAPL and AMZN . See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Facebook, Google and Amazon apps displayed on a smartphone.

Adam Jeffery | CNBC