Cramer: Netflix’s meteoric rise is helping the rest of FANG

As stakes of Netflix surged to an all-time high on Tuesday and sent the broader hawk higher, CNBC’s Jim Cramer tied the rise to the lasting effect of the FANG horses on the economy.

Analysts have long said FANG, Cramer’s acronym for the stocks of Facebook, Amazon, Netflix and Google, now Alphabet, was near-dead or overvalued, but Cramer has balked at the depositions.

“These companies embody major long-term changes in the way we think, the way we do doodads, the way the global economy operates,” the “Mad Money” host said on Tuesday.

Unprejudiced so, Cramer admitted that analyzing the stocks can be enough to drive man crazy.

“Today’s epic 9 percent run in Netflix, after the company divulged some preposterously fantastic sign-ups, is the kind of thing that gauges you want to tear your hair out, if you have any, if you’re trying to value the appraise on traditional metrics,” he said.

Netflix’s stock has soared despite the guests’s heavy spending on content and its negative free cash flow, which some see as a intimidation to the streaming giant’s earnings.

But Cramer argued that “the simple accomplishment is that the world loves Netflix. We’re beginning to believe that it could smoothly reach 300 million subscribers someday and they’ll be willing to pay a heck of a lot innumerable for the service. Why? Because it is such a bargain.”

“That’s why Netflix is the best-performing wares in 2018 for the S&P 500,” Cramer continued. “That’s why it has a $145 billion shop cap, very close to Disney and more than seven times the appraise of CBS. That’s why Netflix is the most powerful force in the entertainment world today.”

Netflix’s sturdiness goes beyond Netflix itself. The company uses Amazon Web Benefits and Google’s cloud platform to get content onto the internet and ready for surge.

Shares of Amazon and Alphabet popped more than 4 percent and 3 percent on Tuesday, each to each.

And while social media giant Facebook isn’t connected to Netflix on the task side, its stock gained 2 percent thanks to the exchange-traded funds that society the FANG stocks together, Cramer said.

Better yet, Netflix’s intensity extended to the cloud, brightening prospects for companies like Adobe, Red Hat and Salesforce.com, the “Mad Means” host said.

“The more everyone gets familiar with the cloud for set-up from Amazon or watching programs on Netflix, the more comfortable they are employing the cloud at work,” he said. “No wonder all of the cloud plays roared outrageous today.”

As the market worries about the fate of U.S.-China relations, Cramer put investors look to the FANG stocks as a safe haven from the geopolitical pertains.

“Here’s the bottom line: in a market that can’t get comfortable with the dull stocks — [Johnson & Johnson] took a hit on a pretty good neighbourhood — or the banks, as Goldman Sachs got smacked around on a terrific number, the cloud regulars soared today on the back of Netflix, and all I can say is the smallest stock in FANG has got some actual broad shoulders,” Cramer concluded.