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Fund Managers Name Favorite Value, Growth Stocks

"Value" and "growth" mean different things to different analysts. Two fund managers, Turner Investment Partners' William McVail, and Putnam Investments' David King, explained to "Morning call" viewers how they define the investment terms -- and named the stocks they like.

King told CNBC's Liz Claman that he sees value stocks as shares that "look cheap on their future cash flows." The portfolio manager of the Putnam New Value Fund said his orientation is not asset-oriented, but guided by the metrics one would use in "buying a small private business."

"What would you pay for an apartment, or a drycleaner?" King said. He said the criterion works whether he's considering "a biotech or a cement-maker."

King likes the mortgage insurance sector, and said the very conditions making housing "challenging" are "fleshing out" second-mortgage providers.

Lehman Brothers is a stock he bought in the late 1990s. He believes that buying the sector's stocks near book value "will make you very happy three to five years from now."

McVail believes that "growth will continue to work reasonably well" in the U.S. He noted that the market is "just 2% off of an all-time high." He waved off apparent sluggishness as June's standard "pause that refreshes," letting the markets consolidate.

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"As the economy shows stabilization, we'll see better GDP numbers over the course of the year," McVail said.

And where does the manager of the Turner Small Cap Growth Fund invest his portfolio? "We continue to like Internet stocks," he said, pointing to Google specifically.

The portfolio strategist conceded that "to the average investor, a stock trading 26-times this year's numbers may look expensive -- but we think it will grow 30% to 50% annually." He said that scenario is "a value compared to, say, Kellogg -- trading at 17-times earnings."

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