According to an article published by Bloomberg Cheapest Stocks in 16 years draws investors, "Investors are preparing to snap up shares of telephone, health-care and computer companies after last week's $2.1 trillion global stock market rout left U.S. equities the cheapest in 16 years."

I am always pondering stock valuations in search of bargains and have been thinking that there are many bargains to be had. Having come to this conclusion though is not based on the relative market strength or weakness, or whether the over all market is cheap or not. I am not interested in bear markets or bull markets. The average investor should view all markets and promoters of said markets as full of bull. The best way to invest in stocks is the same way you invest in friends - one by one, respectfully, fairly and refraining from judging the proverbial book by it's cover. You should look deeper and think long term.

Some companies have reported terrific earnings Intuitive Surgical (NASDAQ: ISRG), Apple Inc. (NASDAQ: AAPL) and some have been lackluster Johnson & Johnson (NYSE: JNJ). Some have been dismal like housing stocks Pulte Homes (NYSE: PHM) and Toll Brothers (NYSE: TOL). While one could make the argument that stock valuations are at a low point there is more to the story.

Since valuations -- think price-to-earnings (P/E) ratios -- are at a cumulative low, and the market prices stocks based on future earnings and growth of equity potential, then one has to assume the brokerage houses, investment banks, hedge funds, institutions and the like have priced in a continuation of the same low interest, high liquidity conditions that lead to this economic situation. I do not have such clarity in regards to this future.

Maybe the headline should not read "Stocks are the cheapest they have been in 16 years", maybe it should read "Large investors are more tenative than they have been in 16 years". After all look how fast they were jumping ship last Thursday and Friday. In any event, I will continue to write about specific opportunities and resist characterising the over all markets.

The latest weekly report from HitWise shows Google Inc. (NASDAQ:GOOG) with over 60% of the US search market. Thirty-eight of the analysts who cover Google have a buy rating or better on the stock. But, according to Bear Stearns, Google's hyper-growth is slowing. Search queries were up 29% in March, but a year ago, that number was 50%.

In the face of all this data, The Wall Street Journal wonders whether investors are putting their expectations for Google earnings, which are going to be released today, too high.

Probably not.

Google still has to earn its tremendous valuation. The company's shares trade at almost 14 times trailing revenue. For Yahoo! Inc.(NASDAQ:YHOO), that number is less than 6x. At eBay Inc. (NASDAQ:EBAY), the figure is about 8x.

None of this is to say that Yahoo! and eBay are not fairly valued. But Google carries a premium of almost 100% when market cap to sales is the measurement. It has to keep growing at the anticipated rate of about 70% year-over-year to keep that premium.

So, when Google reports earnings, expectations will be too high. But, they should be. Google has managed to beat "too high" before.

Douglas A. McIntyre is a partner at 24/7 Wall St.