Apple hitting a $1 trillion market value reflects the company's transition to being recognized as a consumer products maker that just happens to be great at technology, CNBC's said Thursday

To that end, Cramer said, Apple stock needs to trade at a higher price-earnings multiple, because 17 times year-end earnings estimates is too low.

He said Apple stock should trade at a higher multiple when looking at a best-in-class consumer products company like Clorox that has a PE of about 25 times.

"The market is struggling with how much to pay, but it knows it can't pay this little given the fact this is a consumer products company," Cramer told CNBC's "Fast Money Halftime Report."

"Should [Apple] get a 25 multiple like Clorox? I would think people would think that's fanciful because the number is so high," Cramer said. "So maybe we should put a 20 multiple [on Apple]."

If Apple had a multiple of 20, that would put the stock price at around $242 per share.

When Apple hit $207.05 at around 11:48 a.m. ET, it went over the $1 trillion market cap threshold.

"I've been saying this is a consumer products [company] for some time, and people are starting to figure that out," Cramer said.

The "Mad Money" host also praises Apple CEO Tim Cook, who took over in 2011 after co-founder Steve Jobs died, as "very underrated and very understated."

"[Cook] believes that the product speaks for itself, not Steve Jobs and not Tim Cook, the product," said Cramer, dismissing the criticism of Cook at times over the years as not being an innovator like Jobs.

"What Tim did and Tim does is say, 'I will put out the best possible product. And will develop an ecosystem and that will develop a service revenue stream. But I won't put out a product that isn't any good,'" Cramer said.