Cramer: Nerve-Wracking Valuations

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Editor's Note: This article was originally published on Real Money at 7:08 a.m. ET on April 29. To see Jim Cramer's latest commentary as it's published, sign up for a free trial of Real Money.

NEW YORK (Real Money) -- Here's the current twinned narrative.

We should be worried about international companies if they have big exposure to Europe, because they will have shortfalls and slower revenue growth and are inherently risky. Or we should be worried about domestic growth stocks because they are overvalued and are therefore intrinsically risky.

You know this. I know it. It's the dialogue. No one comes on air or writes in these cyber pages that there's little earnings risk in PPG or Alcoa because of Europe. No one says, "Right now I don't have to think about Europe or Procter & Gamble because things will be fine." That's simply not happening. Everyone is worried. In fact, we will accord it to a company like Kimberly-Clark , which pulled out of the western and central European diaper market because it had had enough with the lack of profit or growth in what is basically a low-birthrate, totally cutthroat market.

No one is getting a free pass for Europe, so the idea that we should be worried about it is absurd. We are worried about it.

Similarly, do you know anyone who is saying that General Mills is a "table-pounding buy" at 18x earnings? Or that you have to get into Wal-Mart at 15 times earnings, or that Coca-Cola is a "steal" at 19 times earnings? The only steal in this market is what Warren Buffett and his Berkshire-Hathaway got with Heinz . He's paying only one to two multiple points above the price-to-earnings multiples of General Mills and Coca-Cola for the whole company.

I am not even going to go there with Verizon . Without a transaction that would accelerate its growth rate via ownership of all of Verizon Wireless -- at a price that wouldn't ruin its balance sheet -- I think you are taking a lot of price risk to pick up that 3.84% dividend yield. That's especially so after AT&T has shown how things can go wrong and a stock can be knocked back on a subpar wireline quarter.

These stocks are expensive. All of safety is expensive when you consider, say, a stock like American Electric Power , with its anemic growth -- a five-year average of 3% and change. You do get a 3.88% yield with that name but, again, why couldn't that go to 5% on any sign that rates will back up?