The former Wolves striker is the most expensive player ever purchased by the Black Cats but the manager believes that the £12 million fee they paid represents good value
The Scottish striker joined Sunderland from relegated Wolves and eyebrows were raised when O'Neill elected to splash out a significant figure to secure his signature.
But after scoring three times in his first two games, including yesterday's opening goal against Liverpool, O'Neill believes that his decision to bring in the forward is quickly proving a good call.
"So far, he has been absolutely terrific, I am just delighted with him," he told reporters. "I just couldn't be more pleased.
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"I am just pleased for him. It's nice for the crowd to take to him at this minute - that will give him a boost of confidence as much as anything else, but goals, of course, are very pleasing."
Fletcher was brought to the Premier League by then-Burnley manager Owen Coyle in 2009 and he notched eight goals in the club's unsuccessful bid to stay in the top flight.
He then moved on to Wolves for a fee reported to be around £3m and after two seasons at Molineux earned a move to the north-east this summer.
Despite being one of the Premier League's most expensive strikers, Fletcher is in international exile after a bust-up with Scotland manager Craig Levein.
However, when asked by a follower on social networking site Twitter whether he would return to the national team if asked by Levein, he replied "yes".