NEW YORK (TheStreet) -- U.S. equities have declined for four straight weeks but Leon Cooperman, CEO of Omega Advisers, said stocks are fairly valued and the bull run is not over yet.
He said on CNBC's "Fast Money Halftime Report" Monday that quality stocks are a better value than bonds. Aside from having a historically in-line valuation, 35% of the S&P 500 companieshave a higher yield than the 10-year Treasury note, which currently yields about 2.2%. Lower oil prices should give a boost to consumers and corporations, which should help the economy.
Investors should be relieved when interest rates rise and worried if they don't rise. Historically, stocks perform well when rates rise because that indicates the economy is strong. The U.S. does not appear to be on the brink of a recession, which would be noticeable if there was accelerating inflation, an inverted yield curve and declining employment, none of which is currently present.
The market is fairly priced, according to Stephanie Link, chief investment officer of TheStreet and co-manager of the Action Alerts PLUS portfolio, agreeing with Cooperman. However, some companies continue to trade at a discount to their growth rate such as Honeywell (HON) - Get Report and Google (GOOGL) - Get Report .
Pete Najarian, co-founder of optionmonster.com and trademonster.com, agreed quality stocks are a better opportunity than bonds. Over the past few weeks, stocks have been trading on technicals rather than fundamentals. That has presented great buying opportunities in stocks including Goldman Sachs (GS) - Get Report and Johnson & Johnson (JNJ) - Get Report .
"I think we're out of the woods," at least in 2014, said Joseph Terranova, chief market strategist for Virtus Investment Partners. The worst seems to be over and stocks are likely to trade sideways to slightly higher for the remainder of the year.
Josh Brown, CEO and co-founder of Ritholtz Wealth Management, pointed out the S&P 500 climbed 1% on Friday, when small-cap stocks finished lower. This likely indicates that further downside exists.
International Business Machine (IBM) - Get Report reached a 52-week low after missing on revenue and earnings. TheStreet's Herb Greenberg said the company's five-year road map was nothing more than a "marketing tool" used to get investors and analysts excited. Investors should take guidance -- especially guidance forecasted years into the future -- with a grain of salt.
However, not all guidance and five-year road maps are bad, said Najarian, who pointed out Hewlett-Packard (HPQ) - Get Report issued a long-term outlook in 2012. Since then, the stock is up 140%. He said the difference is this company's management executed very well compared to IBM.
Link added IBM was too slow in its move to software and services. Instead of building out these businesses, they should do so via M&A.
A lot of this slowdown was inevitable, according to Steve Mulanovich, managing director at UBS. He said it will take several years for IBM to turn around its operations, but the stock likely has limited downside. As for Apple (AAPL) - Get Report , which reports earnings after the close, he is looking for slightly higher margins and iPhone sales of roughly 37.5 million. Guidance for next quarter will be key, but there appears to be upside going forward.
"There might be something in the report that makes me want to buy," Terranova said of Apple, but likely "nothing that makes me want to sell." Najarian agreed, saying he expects the report and guidance to be strong.
Terranova said Valeant Pharmaceuticals (VRX) has a good business model after the company topped third-quarter earnings and revenue estimates. The company is likely to raise its bid for Allergan (AGN) - Get Report as well, he said.
VF Corp. (VFC) - Get Report missed revenue and earnings estimates but is still a buy, Link said. She said the company increased guidance and should have better comp-store sales going into the holiday season.
For their final trades, Najarian is a buyer of Cirrus Logic (CRUS) - Get Report and Brown is buying the iShares U.S. Preferred Stock ETF (PFF) - Get Report . Link is a buyer of American Express (AXP) - Get Report and Terranova said to buy Buckeye Partners (BPL) - Get Report .
-- Written by Bret Kenwell