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Financial Stocks: Foolproof or Foolish?

Watch net interest margins in the banks' quarterly earnings, Stephanie Link of TheStreet said Tuesday.

"If you believe the economy is on the rising, improving gradually – and I do – you think a steeper yield curve will continue," she said.

On CNBC's "Fast Money," Link said that she didn't expect stellar news out of the financial sector's quarterly earnings.

"You're not going to see NIM increases and improvement this quarter, I don't believe, at all," she said. "And I think if these stocks sell on that news, you want to be buying them because I think by the fourth quarter and into 2014 you will see better NIM, but more than that, you'll see loan growth."

Link also said that she liked regional names such as KeyBank and M&T Bank.

Tim Seymour of EmergingMoney.com was somewhat less sanguine.

(Read More: Stay Bullish on Stocks Despite Headwinds: JPM's Tom Lee)

"I think it's a dangerous time to actually be flying into a trade that's done very well," he said. "And at 1.1 times price-to-book, it's not cheap anymore."

Seymour said that he didn't expect much good news out of second-quarter earnings, warning that financial companies could start to rely "on cost-cutting to make money again."

"I wouldn't be jumping out a window," he added.

(Read More: 'Dividend Aristocrats' vs. Rising Rates)

Stuart Frankel's Steve Grasso said that he was most positive on JPMorgan ahead of earnings.

Also on his list of favorites were Citigroup and U.S. Bancorp.

"You've got to go with what's working," he added.

Trader disclosure: On July 2, 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 WFC; Stephanie Link is long CSCO; Stephanie Link is long EBAY; Stephanie Link is long FB; Stephanie Link is long JWN; Stephanie Link is long GPS; Stephanie Link is long COST; Stephanie Link is long HIG; Stephanie Link is long F; Jon Najarian is long AAPL; Jon Najarian is long ZNGA; Jon Najarian is long KSS; Jon Najarian is long DVA bought today; Jon Najarian is long COG; Jon Najarian is short XLF puts; Tim Seymour is long BAC; Tim Seymour is long INTC; Tim Seymour is long GM; Tim Seymour is long F; Steve Grasso is funds long AAPL; Steve Grasso is funds long ZNGA; Steve Grasso is funds long STZ; Steve Grasso is funds long F; Steve Grasso is funds long GM; Steve Grasso is funds long MU; Steve Grasso is long BA; Steve Grasso is long BAC; Steve Grasso is long GDX; Steve Grasso is long GOOG; Steve Grasso is long MHY; Steve Grasso is long HPQ; Steve Grasso is long LNG; Steve Grasso is long MJNA; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long QCOM; Steve Grasso is long S.

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