Goldman Sachs Chief Equity Strategist David Kostin says an improving economy means investors should look to value stocks.

“When the economic data starts to get better is when you want to own value, and value over time tends to outperform,” Kostin said in an interview with “Squawk on the Street” on CNBC. He added that firms like AIG, General Motors, and Delta Airlines are in value sectors but also offer growth. “Goldman Sachs research analysts who cover those stocks have a ‘buy’ rating with meaningful upsides greater than the upside than I have in the forecast for the overall market,” he said.

With the US growing faster than Europe and Japan, Kostin also says to focus on firms generating significant domestic revenues. “If you are a company selling into those end markets, your volumes are just greater,” he said. “On a translation from a price perspective, competition exporting and translating those foreign earnings would make it better to own U.S. companies selling domestically.”