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I, too, have been somewhat unsettled by the choice of an admittedly great stock on the basis of RM methodology. My biggest concern is not, however, the fact that YHOO doesn't meet the $1 billion in sales, as many have pointed out. Rather, my concern is with what I consider to be an overinflation of the Monopoly Status score. By comparing YHOO to XCIT, I think the port managers have chosen a weak competitor that is not the most appropriate comparison. I'm sure there will be some disagreement on this, but even YHOO's quarterly report lists such powerhouses as AOL and MSFT among the competitors. While XCIT may be the closest "pure portal" competitor, I don't think that the purity of a portal is going to matter much in the race for providing access to content on the Internet. The more content a site has, the more likely people are to visit it, not only as a destination site, but also as a way to link to other sites of interest. With the pending acquisition of XCIT by ATHM, I'm not sure that the comparison has taken all of our knowledge into consideration. One would really need to compare YHOO to a combo of ATHM and XCIT (with ATT backing). These comparisons may become clearer in the next quarter or two, once we start to see some of the recent mergers showing up on the balance sheets. AOL will also put up a strong fight as the initial site for users logging on. If you take these competition considerations into effect, I think YHOO's RM score would be in the low 40s at best, and the "it meets almost all of our other standards" argument would be much less convincing.

Any thoughts?
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