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I’m No Pollyanna, Stock Bull Says

Based on valuations and margins, the stock market still has room to grow, Delphi Management President Scott Black said Monday.

Estimating a "conservative" $105 in corporate earnings for large-cap stocks, up 8 percent year over year, he said that the market was trading at multiple of 15.3 times percent vs. a historical norm of 16.

On CNBC's "Fast Money," Black said that margins, also, were positive.

"The one good thing is that we're getting good operating leverage," he added, noting that even though earnings were up about 8 percent for the first quarter, revenues were only up 2.2 percent, equating to margins of 9.6 percent.

"This is the highest operating margin in the S&P since the third quarter of 2011," he said.

Black also responded to a Goldman Sachs note calling cyclical stocks undervalued.

"I would agree that some of the consumer staples are expensive," he said, adding that there were big technology names such as Qualcomm, EMC and Oracle, comprising a "homogenous risk class," which, "if you back out their excess cash, that are extremely cheap."

Trader disclosure: On May 6, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Stephanie Link is long AAPL; Stephanie Link is long GS; Stephanie Link is long JPM; Stephanie Link is long CSCO; Stephanie Link is long FB; Stephanie Link is long HD; Stephanie Link is long GE; Stephanie Link is long ESV; Simon Baker is long AAPL; Simon Baker is long BAC; Simon Baker is long JPM; Simon Baker is long WFC; Simon Baker is long SBUX; Simon Baker is long FB; Simon Baker is long MSFT; Simon Baker is long GOOG; Simon Baker is long HD; Anthony Scaramucci is long AAPL; Anthony Scaramucci is long GS; Anthony Scaramucci is long JPM; Anthony Scaramucci is long MS; Anthony Scaramucci is long MSFT; Anthony Scaramucci is long GOOG; Jon Najarian is long MBI; Jon Najarian is long BAC; Jon Najarian is long JNPR; Jon Najarian is long FFIV; Jon Najarian is long RDN; Jon Najarian is long UVXY; Jon Najarian is short NFLX; Scott Black is long QCOM; Scott Black is long TCAP; Scott Black is long WLL.

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S&P 500
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QCOM
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EMC
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ORCL
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