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Time to ‘dabble’ in home builders?

A few home builders' stocks space may be oversold, making them bargains investors should be considering, Stuart Frankel's Steve Grasso said Monday.

"At this point, I think you have to dabble a little bit in the home builders because the stocks actually took it more on the chin than they should have," he said.

Grasso said he viewed Wells Fargo's upgrade of PulteGroup to "outperform" as a signal to enter into the stock.

"I think you have to because they've been able to pass along increases on a lot of their communities," he said on CNBC's "Fast Money."

OptionMonster's Pete Najarian pointed out that the home builders exchange-traded fund XHB wasn't the best play on the sector.

(Read more: 3 top investment areas: UBS strategist)

"It's none of the home builders," he said. "It's Bed Bath & Beyond and everybody who feeds into these names."

Najarian said that individual names, such as D.R. Horton, were the way to buy into the space.

Josh Brown of Fusion Analytics said that the home builders sector could still offer value.

"But I genuinely believe that the leaders of the next phase of this are not going to be the leaders of the last phase," he added. "This group, if you look at the XHB, you have a pretty substantial case to make for a head-and-shoulders."

(Read more: Rally not over, gold's a 'buy': JPM analyst)

Brown also pointed to the most recent figures on housing starts.

"I don't think those numbers improve. They may not deteriorate, but right now growth investors are looking for things that are improving," he said. "They will not find them in those housing starts numbers. As a result, I think this group is kind of going to be left for dead for a little while."

James Lebenthal of Lebenthal Asset Management said that at least in the short-term, the sector was still worth a look.

"You want to buy the things that are beaten down here," he said. "This is a trade here."

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

Trader disclosure: On Aug. 19, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Steve Grasso is long BA; Steve Grasso is long BAC; Steve Grasso is long BBRY; Steve Grasso is long GDX; Steve Grasso is long GOOG; Steve Grasso is long HERO; Steve Grasso is long HPQ; Steve Grasso is long MHY; 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; Steve Grasso is long ASTM; Steve Grasso is long POT; Steve Grasso is long DECK; Steve Grasso is long DHI; Josh Brown is long JPM; Josh Brown is long AAPL; Josh Brown is long TGT; Josh Brown is long GOOG; Josh Brown is long QCOM; Josh Brown is long BK; Pete Najarian is long AAPL; Pete Najarian is long C; Pete Najarian is long BBRY; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long SE; Jim Lebenthal is long AAPL; Jim Lebenthal is long BAC; Jim Lebenthal is long C; Jim Lebenthal is long GS; Jim Lebenthal is long JPM; Jim Lebenthal is long WFC; Jim Lebenthal is long MS; Jim Lebenthal is long INTC; Jim Lebenthal is long WMT; Jim Lebenthal is long FB; Jim Lebenthal is long CAT; Jim Lebenthal is long DIS.

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