The Scot, who has scored 22 Premier League goals over the past two seasons, is believed to have cost the Wearside club as much as £12 million.
However, Mackems boss O'Neill expects the sizeable fee to be paid back by the 25-year-old's performances on the pitch.
"I think Steven will be terrific for us. He's underrated, but not by me," O'Neill told reporters.
|11/1||Sunderland are 11/1 to finish in the Premier League top six with Bet365|
"I'm delighted to have him for the next few seasons."
The Northern Irishman remained tight-lipped, however, on following up Fletcher's acquisition with a potential swoop for Manchester City pair Adam Johnson and John Guidetti.
"As good as they are, I don't think our players can do it on their own and the more help we can get there the better," he added.
"I'm still trying to improve the team, obviously. Like everything else we need some more help and we're trying to provide that and get that there before next Friday evening."