US Markets

Trader: Where to find value in the selloff

Finding value in US-centric stocks: Pro

Fears of a Chinese slowdown may still be roiling markets, but the global equity selloff is presenting opportunities for investors as U.S. stock valuations begin to look a little less rich, Aureus Asset Management CEO Karen Firestone said Tuesday.

Stock prices were pointing up before the opening bell Wednesday, a day after major U.S. averages fell sharply following disappointing Chinese manufacturing data. The Dow Jones industrial average and closed Tuesday nearly 3 percent to post their worst start to September in 13 years.

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However, just five weeks ago, U.S. stocks were trading at roughly 17 times next year's earnings estimates, Firestone told CNBC's "Squawk Box." But they've since fallen to just under 15 times 2016 projections.

"The market gets scared with the higher valuations. We've come down to a level that we think has many attractive stocks that are down over 20 percent with earnings growth that's very strong," she said.

Aureus is focusing on U.S.-centric companies with a preference for consumer names and health care, Firestone said, noting that U.S. GDP grew 3.7 percent in the second quarter and consumer spending rose in July.

Among Firestone's top picks is TJX Companies, which is seeing strong earnings growth in the low teens, trading at 18 times earnings and benefiting from household formation.

Retailers like TJ Maxx and Home Goods are getting shoppers through the door and boosting same-store sales growth by limiting their online inventory and rapidly changing selections in stores, she said.

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Firestone also likes Delta, which she said is benefiting from low crude-oil costs more than most airlines because it has not hedged its fuel prices, so it is capturing more savings. In addition, a dividend increase is likely, she said.

The airline is also poised to capitalize on the spending habits of young consumers, she added.

"When you think about the way millennials spend their money, they don't spend it on as much stuff. They spend it on experiences, and so the airline industry, we think over the next several years, will benefit from that trend," she said.

In health care, Firestone sees Anthem as a beneficiary of higher premiums, a growing subscriber base and industry consolidation. While its stock price is down 19 percent from its peak, it is trading at 12 times forward earnings, she said.

Medical device maker Boston Scientific, trading at 16 times 2016 earnings, also looks attractive due to double-digit growth, an improved balance sheet and a pipeline of new products in intervention and implantable devices for cardiac and vascular use, Firestone told CNBC.

—CNBC's Klaire Odumody contributed reporting to this story.

Disclosure: Firestone and her family own all the stocks listed here as clients of Aureus Asset Management. The firm does not hold more than a 1 percent share of the stocks and does not provide investment banking services to the companies.